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Lou Dobbs Tonight

New Year's Eve on High Alert; 'Broken Borders'

Aired December 31, 2003 - 18:00   ET

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

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


(BEGIN VIDEOTAPE)
ANNOUNCER: New Year's Eve on high alert. Millions of Americans will ring in the new year under unprecedented security. We'll have live reports from Times Square in New York city and Washington. We'll talk with the police chiefs of Miami and Seattle.

In "Broken Borders" tonight, the new year will bring a new system for tracking foreign visitors to this country. Lisa Sylvester will report on whether the massive overhaul will make Americans any safer.

2004, the year that many Democrats have been waiting for is here. On the eve of what's sure to be a contentious election year, Ron Brownstein of the "Los Angeles Times" and Karen Tumulty of "TIME" magazine will join us for a political roundtable.

America's bright future, two Connecticut brothers whose research on the West Nile virus has brought us just a little closer to understanding the mysterious disease. Bill Tucker will have their story.

And this year's hits and misses at the box office. Martin Grove with the "Hollywood Reporter" will join us with his picks of the best and worst movies of 2003.

ANNOUNCER: This is LOU DOBBS TONIGHT for Wednesday, December 31. Sitting in for Lou Dobbs, who's on vacation, John King.

(END VIDEOTAPE)

JOHN KING, GUEST HOST: Good evening. Tonight the new year is approaching amid new warnings of possible terrorist attack and cities and towns across the country are taking extraordinary steps to make sure Americans celebrate safely.

(BEGIN VIDEOTAPE)

KING (voice-over): High alert at the dawn of the new year, celebrations, despite government warnings of possible terrorist attacks.

PASQUALE D'AMURO, NEW YORK FBI DIRECTOR: Some of the threats that we've been dealing with recently have a higher level of credibility so that causes us additional concern.

KING: New York's Times Square is one scene of unprecedented security. A city targeted before, taking extra precautions even as top officials urge revelers to enjoy the big night.

COMMISSIONER RAY KELLY, N.Y. CITY POLICE DEPT.: There's chatter about biological, chemical, radiological events possibly happening so it's something that we're concerned about.

KING: In Chicago, a greater police presence with the main event at Navy Pier and restrictions on flights in the skies above. A ten- mile no-fly zone has been ordered over Las Vegas where military aircraft will patrol as part of the stepped up security over the city's famous and festive strip.

GOVERNOR KENNY GUINN (R), NEVADA: This is a first time but in our planning we kind of felt like America has certainly changed and the world has changed, and we have to change with that.

KING: More police on hand for Boston's first night celebration. And these metal trash containers are being replaced with cardboard boxes to minimize the damage in case of an explosion. The Rose Bowl is one of several security priorities on New Years Day. Skies over the football game restricted and thousands of police assigned to the route of the annual Rose Bowl parade.

CHIEF BERNARD MELEKIAN, PASADENA POLICE: We're very confident that there's no specific threat against Pasadena or the events.

KING: Overseas, Australia kicked off a day of worldwide celebration amid heightened security. And hours later, the clock hit midnight in Moscow. In Baghdad, a new year but sadly a familiar sight. A deadly terror strike at a restaurant where patrons were celebrating the dawn of 2004.

(END VIDEOTAPE)

KING: This unprecedented security comes as a result of intelligence suggesting terrorists are planning an attack here in the United States. Joining us with more is justice correspondent Kelli Arena in Washington. Kelly, from your sources tonight, what is the latest on the threat?

KELLI ARENA, CNN JUSTICE CORRESPONDENT: John, the threat information has been very general in nature, although we have heard information about very familiar cities, Los Angeles, New York, Washington D.C., Chicago, Las Vegas. That is -- those are cities that are named within the chatter.

None of it is very specific. There's no specific target that's been mentioned, no specific method of attack. However, as you mentioned in your report, you interviewed Pat D'Amuro who is one of the nation's top counterterrorism officials. He is the man who runs the New York FBI field office.

As Pat said, the information this time is a little more credible. I can tell you that our sources have told us that some of the information regarding New Year's has come from an informant who has worked with counterterrorism officials before, who has provided reliable information, so this takes it beyond the level of just anonymous chatter. This is actually coming from someone that is a known source.

And the volume of information is what is a concern as well. It corroborates each other. What they hear from one part of the world, they are hearing very similar information from another part of the world. Take that altogether, put it into the threatened matrix that is put together every day, and you have a very high level of concern. But, again, nothing that they can actually pinpoint, John.

KING: That must be frustrating, Kelli, nothing site-specific or a specific type of attack.

ARENA: That's right. As every counterterrorism official will tell you, this is more an art than it is a science. What analysts are doing behind the scenes is taking these bits of information, we all heard a lot after 9/11 about not connecting the dots, about an inability to see the bigger picture. Well, now, what you have is just the opposite.

You have little bits of information that are being tied together by analysts who are looking at things that the intelligence doesn't necessarily get you to say a specific event happening in Las Vegas, for example.

But little bits of information put together can lead someone to surmise, well, maybe this is what this is talking about, and so you have leaps that are being taken which sometimes can cause a problem because when leaps are taken, it's very hard to act on things that are not concrete but it does add to sort of a frenzy that can occur and a frenzy is not what anybody wants at this point.

KING: Kelli Arena for us tonight in Washington. Thank you very much, Kelli.

ARENA: You're welcome, John.

KING: The debate over how Americans should respond to the nation's heightened terror alert was stoked today here in New York when a prominent member of Congress urged people to stay away from Times Square and other large gatherings. Among hundreds of thousands of people ignoring that advice is Peter Viles -- Peter.

PETER VILES, CNN CORRESPONDENT: John, that congressman, Christopher Shays of Connecticut, set off an immediate firestorm when he said yesterday, and this is a quote, "you've got to be a fool to do what we did tonight, which is to come to Times Square on New Year's Eve.

(BEGIN VIDEOTAPE)

VILES (voice-over): As New York woke to the headline "On Guard," and news of the tightest security in the city's history, a Connecticut congressman said what others certainly must have been thinking.

REP. CHRISTOPHER SHAYS (R), CONNECTICUT: You've got to be a fool, frankly, to go on New Year's night to Times Square. I can't understand why people do that. Just one hand grenade thrown in the air and people panicking. It's too tempting a target. Maybe you want to say we're going to survive and nobody's going to get -- but why put yourself in that position?

VILES: In New York, the mayor and the police commissioner took exception, saying their city is safe and a great place to celebrate.

MAYOR MICHAEL BLOOMBERG, NEW YORK CITY: I want to urge everyone to leave the worrying to the professionals. That's what these security levels are for. They're for professionals. The rest of us, let's go to Times Square. It's going to be a fantastic night. A great beginning to a wonderful 2004.

VILES: The back and forth raised a serious issue. How useful is government advice that says don't change your travel plans, but be ready, be on alert because the risk of an attack is high?

HELEN MORRISON M.D., PSYCHIATRIST: It's a conflicting message, but we get that message in almost everything we do, eating beef, smoking, going to the beach, driving a car, getting in an airplane. But those things we tend to know what the risks are. With terrorism, it's such a very vague threat.

VILES: Congressman Shays drew criticism partly because he took that "vague threat" and made it specific to Times Square.

BRUCE SCHNEIER, AUTHOR, "BEYOND FEAR": I think it is alarmist. I think avoiding places where terrorists might strike is ridiculous. They might strike everywhere, they might strike anywhere. They're likely going strike nowhere. If you're going to Times Square, you should dress for the weather, you should worry about pickpockets. After that, everything is else is in the noise.

(END VIDEOTAPE)

VILES: Well, the noise, John, is starting to pick up here. The crowd picking up. Extremely tight security. It took us quite a while to get in here. It's almost like trying to get on to an airplane. But the weather's fine, probably about 40 degrees. I've always wondered what do these people do for six hours? It's six hours now to midnight. They're having a great time. There's a band playing. They just raised the ball so a very festive feeling here, John, in Times Square.

KING: Well, Pete, tell us a little bit more about that security as you get closer to Times Square. I assume the security gets tighter. What do you have to go through? Is it magnetometers, bags being searched, what exactly is happening?

VILES: Bags are being searched. They're doing it one at a time. It's very slow. I'd be surprised if they get everybody in here who's on line right now trying to get into here.

But they do use the same wands they use in an airport over your entire body. They'll ask you to open up bags and such. It's very orderly. There's no place where there are a lot of people coming here. It's one at a time. Two police officers searching each one person at least, in the entrances we looked at on our way in here, John.

KING: Peter Viles for us tonight in what looks like an already festive Times Square. Take care, Peter. Thank you.

And joining me now for more on this heightened security this New Year's Eve are the police chiefs of two major American cities. John Timoney is the chief of police in Miami and Gil Kerlikowske is Seattle's police chief. Gentlemen, thank you both for joining us tonight.

I will begin with you, Chief Timoney and ask you both. What about the point raised by Congressman Christopher Shays today. Would the government be doing you a favor, sir, if it said, stay home, this nation is under risk of terrorist attack, do not gather in a large public place?

CHIEF JOHN TIMONEY, MIAMI POLICE DEPARTMENT: No, I don't think so. I think the Congressman is wrong in this case. Life has changed post-September 11 and we're a lot more like Britain over the last 30 years with I.R.A. Threats, where they've had so many close-downs, a whole host of lifetime interruptions, if you will.

It's something we're going to have to get used to. As much as humanly possible, people should resume normal activities and particularly on New Year's Eve. Times Square, I spent 29 years -- a lot of nights up in Times Square on New Year's Eve, it's the best place in the world to be and Mayor Bloomberg's right, people should come and not hesitate to come.

KING: Chief I assume you believe the Space Needle is the second best place in the world to be, then?

CHIEF R. GIL KERLIKOWSKE, SEATTLE POLICE DEPT.: I do. The Space Needle, of course, is one of the most protected sites. It a large venue in our area called Seattle Center. The police department has taken extraordinary steps particularly after the millennium celebration was canceled here in 1999. So we have a good plan in place. We have a lot of people on duty. People should come out and enjoy themselves. I also agree with John that congressman was offbase on that. We cannot -- we know that we're in a different world after 9/11 but we need to go ahead and adapt and as Mayor Bloomberg said, and as our mayor said, leave the worrying to the professionals.

KING: Let me stay with you, Chief Kerlikowske, then come back to Chief Timoney, there are have been complaints in past when the alert level goes up you're not getting specific information about the threat. Share with us this experience and as you answer, sir, each of you, any particular specific threat in your city?

KERLIKOWSKE: I have to tell you, first, secretary ridge has unbelievably responsive to the concerns raised by first responders, by local law enforcement and other public safety officials. And this time when the alert level was raised we were on a conference call on a Sunday morning with the secretary and many others. We had the information in advance. They were as specific as they could be. And they're very much -- and I can understand not wanting to heighten the alarm but also wanting to make sure that the people that are so-to- respond first, which is local law enforcement, has the information.

KING: Do you achieve, chief?

TIMONEY: Absolutely. The other thing, you know, there are a lot of people, naysayers that complain about the raising of the alert system as if it's happening every other week. It's not. The last time it was March 17. And so I think Governor Ridge is getting a bad wrap for this. It's been twice this year it's been raised. It is an inconvenience. Often it isn't specific. What I can tell you is, I find it in some way comforting to remind us that we still have an enemy out there. Our biggest enemy, if you will is complacency, both from a police perspective and also the public. That the further we get away from 9/11, the safer we feel. That may be a false sense of security and these alerts remain us constantly there's someone out there to worry about.

KING: And I'd to ask each of you this question. We focus a great deal on aviation security.

Chief Timoney beginning with you, what else is it you're being told to watch out for?

Does that mean targeting things like sports stadiums, you have bowl games this weekend, does it mean targeting hotels, suicide bombers?

TIMONEY: We have a Christmas village down here in Miami, those big festivities tonight. Tomorrow we have the Orange Bowl. And any event that has a large gathering of people gives a terrorist what he needs. Symbolism and a high body count. And so you have to have extra police presence, particularly uniformed presence, at these venues. As Governor Ridge pointed out last Saturday, it looks like according to the chatter, the airplane is the preferred vehicle as a weapon.

KING: Chief

KERLIKOWSKE: Well, I think we need to be open and make sure we're not just focusing in on any particular threat. Because remember, there's been no specific threat to a venue within the United States and there hasn't been a specific method of attack though, as you said, aviation comes up. Recently, in fact, this summer, Seattle participated in a program or an exercise called top-off. It was the largest counterterrorism exercise in the nation's history. That was a radiological dispersion device or a dirty bomb. Chicago also participated in that, and with a biological threat. So we want to make sure we're being as flexible and as open and as understanding of what all of the threats may be.

KING: Chief Gil Kerlikowske in Seattle and John Timoney in Miami, gentleman, thank you both for joining us and best of luck.

TIMONEY: Thank you, John, happy New Year.

KING: Happy New Year. Good luck to both of you this weekend. That brings us to "Tonight's Poll" question, have fears of an attack and the heightened security caused you to alter your plans for New Year's Eve, yes or no?

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

And coming up, more violence in Baghdad today. A deadly reminder of the work still to be done in Iraq.

The Pentagon correspondent Barbara Starr will report on what lies ahead for the coalition.

Then, new controversial security measures. A plan to track foreigners in the United States. Lisa Sylvester will have that report.

And the best and worst movies to hit the big screen this year. Martin Grove, columnist for the "Hollywood Reporter" will join us with his list of box office winners and losers.

(COMMERCIAL BREAK)

KING: A harsh reminder today there's still a war it Iraq. At least five Iraqis were killed and dozens injured when a large explosion ripped through a restaurant in central Baghdad where people were celebrating New Year's Eve. Iraqi police said the source was a car bomb. The restaurant is popular among westerners and had been advertised a New Year's Eve celebration. The U.S. Military had been on heightened alert, fearing injure gents would launch an attack around the holidays.

Today's blast is the latest reminder of the hurdles to peace that remain in Iraq.

Barbara Starr takes a look at some of the most pressing issue for Iraq and the U.S.-led coalition.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): By June, there is to be a new Iraqi led transitional government with full powers, key to moving beyond the war, the occupation, and the violence that has torn the country apart. The coalition's provisional authority and the Iraq Governing Council will dissolve. By December 2005, elections for a new permanent government. U.S. officials are working frantically to make all of that happen.

RICHARD BOUCHER, STATE DEPT. SPOKESMAN: Really what they're talking about at this point is working to plan the political transition in Iraq. Talking about how to support a U.N. role in that process.

STARR: But the most important hurdle, security. Plans call for Iraq to have its own quarter million manned security force. Police, army, civil defense, and facilities protection. But reality is grim. Bombing attacks against Iraqi police continue, army troops have left, complaining of low pay, perhaps half of the security forces fully trained and equipped. The U.S. plan to put people on the street quickly, a move still defended.

BRIG. GEN. MARK KIMMITT: I think on balance, the commanders would come back and say the decision to not wait until we had the perfect solution was the wise one, the prudent one, and one that's probably saved a significant amount of coalition lives in the process.

STARR: The new government must show it can bring Saddam Hussein to trial. So far, it's not clear if the U.S. will have a role. Economic issues must also be resolved. How to award nearly $20 billion in reconstruction contracts, already controversial because the U.S. will not let countries opposed to the war bid on prime contracts.

Defense Secretary Donald Rumsfeld remains defensive.

DONALD RUMSFELD, DEFENSE SECRETARY: So everyone's clear, the United States did not ban any company from doing anything.

STARR: But the whole reconstruction effort now badly behind schedule. One area that is working out, debt forgiveness for much of the $120 billion in red ink run up by Saddam Hussein's regime. France, Germany and the U.S. have an agreement in principle to have that debt written off. A new Iraqi government, a secure environment, and a healthy economy, all challenges to be faced in Iraq in 2004. Barbara Starr, CNN, the Pentagon.

(END VIDEOTAPE)

KING: And one of the major challenges facing the United States and Iraq is, of course, rebuilding that country's infrastructure. And word tonight, that monumental task may be partially delayed. According to a senior administration official, $4 billion worth of rebuilding work in Iraq may be deferred.

When asked whether the money's being reserved for France, Germany, or Russia, the official said U.S. policy regarding their access to major reconstruction contracts has not changed. The three countries are now barred from that process.

Separately, tonight, a U.S. military energy unit said it would take over soon the job of getting fuel into Iraq ending a deal with Halliburton. The decision follows a draft Pentagon audit showing the firm overcharged for the job. Halliburton strongly denies any wrongdoing.

An incredible story now of survival in the rubble of the Iran earthquake. A baby and a young girl were pulled from the rubble in the city of Bam five days after the powerful earthquake. Rescuers also saved three others.

Those buried beneath buildings typically survive only three days, at most. More than 80 U.S. medical workers opened a field hospital in Bam, yesterday, joining medics from more than 20 countries to treat thousands of wounded. Late today, U.S. officials lifted some banking restrictions against Iran to make it easier for donations to reach survivors. At least 28,000 people were killed in that earthquake.

And coming up, tracking foreigners in this country. New controversial security measures go into effect on Monday. Lisa Sylvester will report.

And the year of politics. Looking back at 2003 and ahead to 2004. Ron Brownstein of the "Los Angeles Times" and Karen Tumulty of "TIME" magazine will join us.

(COMMERCIAL BREAK)

ANNOUNCER: LOU DOBBS TONIGHT continues. Now, "Broken Borders."

KING: The new year marks the start of a new program for the Department of Homeland Security. It's a system designed to identify foreign visa holders entering the United States. The goal, to make sure those who enter this country, leave as scheduled. Lisa Sylvester reports.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT: Three of the 9/11 hijackers overstayed their visas but because the United States did not have an adequate entry/exit tracking system, investigators had no way of knowing that.

ASA HUTCHINSON, UNDERSECRETARY, BORDER AND TRANSPORTATION SECRETARY, DEPT. OF HOMELAND SECURITY: America wants to know that whenever a foreign visitor comes into the United States that they leave on time and if they don't leave on time we know about it because that's a security risk. It gives us that capability.

SYLVESTER: U.S.-VISIT goes into effect Monday at 113 airports and 14 seaports. Foreign visitors requiring visas will be photographed and fingerprinted. When they leave the country, they are required to formally check out. People who overstay their visas will have a harder time returning to the United States in the future.

But there are limitations. The program only applies to people required to have visas. That excludes visitors from 28 countries, including Canada, and most of Europe. British shoe bomber suspect Richard Reid, for instance, traveling from France, would not have been part of the database.

RICHARD NORTON, NATIONAL BIOMETRICS SECURITY PROJECT: Probably over 80 percent of all of our tourists come from visa waiver countries. But they won't have to go through that process.

SYLVESTER: Other concerns, potential glitches could interrupt legitimate travel in commerce, issues over privacy and there could be false positives.

STEPHEN FLYNN, COUNCIL ON FOREIGN RELATIONS: Somebody comes in and we mistakenly believe they're a terrorist or we mistakenly don't recognize them as a terrorist and then that creates real challenges of confidence in the system.

SYLVESTER: And getting people to check out when they leave the country by land is a little tricky. Right now there are checkpoints when people drive into the country. But there are no procedures to stop people when they drive out. Lisa Sylvester, CNN, Washington.

(END VIDEOTAPE)

KING: For the second time in a week the body of a stowaway has been found in the wheel well of a jet at Kennedy airport here in New York. Police discovered a man's body after a British Airways flight from London landed yesterday evening. Nigerian currency was found on the corpse. British Airways says the plane was in Nigeria on December 22. On Christmas Eve, JFK workers found the body of a man in the wheel well of an American Airlines flight from Jamaica.

Coming up, timing the United States' exit from Iraq. A delicate issue for the president and his opponents in the race for the White House. We'll have that story. And Ron Brownstein of the "Los Angeles Times" and Karen Tumulty of "TIME" magazine will join us.

And the year on Wall Street. Mary Snow will take a look at the best and worst of the markets in 2003. Stay with us.

(COMMERCIAL BREAK)

KING: The car bomb that killed at least five people at a Baghdad restaurant today is a reminder that U.S. forces' job there is far from done. The Bush administration would like to reduce military levels in Iraq in the coming year and Democrats are sure to make that progress or lack of progress in Iraq a major campaign issue.

(BEGIN VIDEOTAPE)

KING (voice-over): Laying out an exit strategy for Iraq will be a key challenge in the campaign year just ahead.

JOHN PODESTA, FORMER CLINTON CHIEF OF STAFF: I think that the president really hasn't explained any strategy in terms of the long run. I think they're kind of weighing it day by day and, you know, kind of hoping for the best.

KING: The administration hopes to reduce the number of U.S. troops in Iraq over the course of the election year. There are no guarantees.

DAN BARTLETT, WHITE HOUSE COMMUNICATIONS DIRECTOR: His decision making will be based upon those recommendations by military commanders, not by politics.

KING: A certain Democratic campaign theme will be that while Mr. Bush won the war, he has lost the peace.

PETER HART, DEMOCRATIC POLLSTER: Too many American soldiers killed or wounded. The public is uncertain about the price that we're paying for this war.

KING: Allies of the president concede the price of war in both lives and money will be a sensitive campaign issue.

BILL MCINTURFF, REPUBLICAN POLLSTER: The American electorate has demonstrated a certain limited tolerance of how much money they want to spend in Iraq. I think that they're very clear they want us to find a way out of that country.

KING: The president says he cannot say when U.S. troops will leave Iraq, because so many questions are yet to be answered, including the pace of training a new Iraqi army.

LAWRENCE EAGLEBURGER, FORMER SECRETARY OF STATE: I think there needs to be more of that telling the American people why we're there and why we have to stay there until it's done right.

KING: To Democrats, done right would mean more international help, instead of an overwhelmingly American military force in Iraq.

MCINTURFF: I think it's a debate George Bush could win and should win for this country's stability, but that's, you know, that's why God made campaigns and that's why they are going to be front and center of the 2004 campaign.

(END VIDEOTAPE)

KING: And after all the buildup and anticipation, the season's finally upon us. No, not the traditional holidays -- the primaries and caucuses. Next month, Democratic voters will start paring down their field of contenders, first in Iowa, then in New Hampshire. For more on the political year ahead, and a little bit maybe on the year just passed, I'm joined by Ron Brownstein of "The Los Angeles Times" and Karen Tumulty of "Time" magazine. Thank you both for joining us on this New Year's Eve.

Let's start on the point of that piece just a moment ago. Ron, how can this president enter an election year without an exit strategy? He says, of course, he can't answer that question just yet. But will it be a major issue?

RON BROWNSTEIN, "L.A. TIMES": It will be a major issue. A central focus of the campaign. I don't know if he needs an exit strategy in the sense of guaranteeing to the American people that the soldiers will be home by X date or certainly before the election day itself. What he needs, though, is a sense of progress, John, I think that is the key variable here.

The public I think is much more willing to accept casualties and violence in Iraq if they see us progressing toward the goal of a stable Iraq that would become a source of stability in the entire region. And that's really what he needs. He has the timetable for moving toward Iraqi self-governance next summer. I think he needs progress on those fronts, and some evidence that the violence is tamping down. KING: And Karen, how the Democrats handle that question will, of course, depend on whether their nominee is a war opponent, like Governor Dean, or someone who voted to support the war. Will it not?

KAREN TUMULTY, TIME MAGAZINE: It will, but you know, even among the Democrats, at least among the top tier candidates, you really don't have anyone who's arguing for bringing the troops home at any particular date certain. So certainly if things continue, if things in Iraq continue to have their rough spots, the Democratic candidates are going to jump on that and call as much attention to that as possible. But right now, we really haven't seen much of a specific strategy for many of them, beyond the idea that they would like to see it internationalized.

KING: Let's move on to one of the themes of this week, Governor Dean saying that the Democrats need to back off, that he might be the nominee, they should stop criticizing him, appealing for help from the party chairman, Terry McAuliffe. Listen quickly to why Governor Dean says it's so important that his rivals stop criticizing him.

(BEGIN VIDEO CLIP)

HOWARD DEAN (D), PRESIDENTIAL CANDIDATE: I think that the other guys are so obsessed with our campaign that they're not running a positive campaign. I don't think we can beat George Bush without running a positive campaign. We're going to continue to run a positive campaign.

(END VIDEO CLIP)

KING: Karen, weigh in on that one, will you? Is that whining from Governor Dean?

TUMULTY: Well, there is a, first of all, a certain amount of presumption in there that, you know, he is going to be the nominee and therefore everybody ought to back off. But the fact is that all year long it's been Dean who's been most aggressive in criticizing the others in the race, particularly those who are in Washington, and as being unable and unwilling to stand up to George Bush. So it is a bit like, you know, the schoolyard tough all of a sudden complaining that the little kids are kicking sand in his face.

KING: Ron, does that comment from Governor Dean and his theme throughout the week, does it support what the Republicans are saying, that they will run against someone who is negative, someone who is reflexive, who shoots from the lip, if you will?

BROWNSTEIN: Yeah, they will. I mean, if Dean is the nominee, clearly Republicans believe that this temperament will be as much of an issue as his ideology. I mean, I agree with Karen, it's kind of a silly complaint from Dean. Really, on two fronts. First, as Karen said, he's been criticizing other Democrats all year. He ran an ad in Iowa criticizing Dick Gephardt on the war. I mean, he's the only one to run a television ad directly by a campaign.

Secondly, he doesn't need the intervention. I mean, he has a very strong base of support, and as he's shown he has a pretty tart tongue. He's perfectly capable of defending himself, but clearly what his rivals believe is a principal vulnerability in the general election, and what the Republicans believe could be a principal vulnerability in a general election is this tendency to say things sometimes before he has fully thought them through. He's spent a lot of time apologizing and clarifying in this campaign, and that will become more of a vulnerability if he does become the nominee.

KING: Our discussions on these issues for weeks if not months have been largely theory and are somewhat speculative, because nobody's voted yet. But let's take a quick look at the calendar. We are 19 days away from the caucuses in Iowa, 20 days away from the president's State of the Union address, 27 or 28 days, depending on how good my math is, from the New Hampshire primary, and then, of course, we move on a week after that to the South Carolina primary. Ron Brownstein, what's about to happen?

BROWNSTEIN: John, in fact, we're about 5 1/2 hours away from people in Michigan being allowed to go online to the Michigan Democratic Party and download ballots that will count, and request ballots. People will start voting there, in early voting that they have for their February 7 caucus next week, in large numbers.

Essentially, this whole race is moving from the hands of the fund-raisers, the strategists and the pundits to the voters, and there are always some surprises along the way.

Clearly the stakes are very high now for the other candidates. Howard Dean is leading in Iowa, he's leading in New Hampshire, he looks good in a number of the February 3 states. He looks especially good in the states after February 3. Someone has to find a way to interrupt this dynamic, to change the basic flow of the race, by surprising, maybe not even beating him in Iowa and New Hampshire, but by changing the expected order.

John Kerry, a surprise second in Iowa. Wesley Clark a surprise second in New Hampshire. Someone has got to find a way to change the dynamic very soon.

KING: Karen, as you weigh in, (UNINTELLIGIBLE) Dick Gephardt. He has to win in Iowa and he has to win big, right?

TUMULTY: And in fact, Dick Gephardt is truly the first speed bump that Howard Dean has to clear. The fact is that he more than any other candidate in this race stands a chance of putting a nick in Howard Dean, slowing him down, at a moment when once again we're getting the first fund-raising numbers from this quarter that suggest that Dean and Clark are really, really the only two guys who seem to be maintaining any sort of financial momentum.

BROWNSTEIN: One critical question, John, quickly, in the next 18 days, does Dick Gephardt go on the air in Iowa criticizing Howard Dean either on trade, most likely, or on Medicare? He seems to be a bit behind that, both sides, both the Gephardt and Dean campaign thinks that Dean has a small but stable lead in Iowa, and the question is whether Gephardt can overcome that simply through organization, or whether he's going to have to go tough on television to try to turn the tide.

KING: We need to end our last discussion of the old year on that point. We'll resume this in the new year, no doubt, with a little bit more information at our disposal. Ron Brownstein of "The L.A. Times," Karen Tumulty of "Time" magazine, thank you so much. And a happy new year to you both.

BROWNSTEIN: Happy new year.

TUMULTY: Happy new year.

KING: Thank you.

And that brings us to tonight's thought, on the eve of the new year.

Quote: "The best thing about the future is that it comes only one day at a time." That from Abraham Lincoln.

And coming up -- the biggest hits and misses to hit the big screen in 2003. Martin Grove, columnist for "The Hollywood Reporter," will join us with his big winners and losers for the year.

(COMMERCIAL BREAK)

KING: The final two weeks of the year are among the busiest when it comes to the movies. So if you're thinking about a movie or two in the days ahead, a few pointers now from "The Hollywood Reporter's" Marty Grove. His favorite film of the year, "Seabiscuit."

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Let's see what you've got, boy. That's it.

MARTIN GROVE, COLUMNIST, HOLLYWOOD REPORTER: Picture just scored across the board. It was a great story. So often Hollywood pays attention to the special effects it pays attention to all of the gimmicks but the story suffers. In this case, the book by Lauri Hillenbrand was a best seller and when you start with a book that's been that successful and jump off from that point, it typically helps a lot.

KING: "Lost in Translation," why on number two you put it?

GROVE: Yes, it could have been number one, certainly a close call. But two is certainly good enough. This establishes Sophia Coppola as major writer of films. It's a very, very good movie. And Bill Murray should wind up with an Oscar nomination. He already has a Golden Globe. In fact, there are five golden globe nominations for the film.

KING: I want to skip down a few on your list to the "To the Cooler," William H. Macy, in this movie in a lead role, unusual for him. Why did you like it?

GROVE: Well, William H. Macy is terrific, so by the way is Alec Baldwin. Alec Baldwin gets wrapped a lot in the press a lot. Let me tell you he's a good actor. And in this film he has good material. Everything works. This is a Las Vegas story. And we've all seen these Las Vegas stories before about the bad guys, the heavies and all of this stuff. But it shows you what that world is like and it does it in a very entertaining way. And Maria Billow who stars with them is very, very lovely and very good.

KING: "Cold Mountain" does not make your list at the moment. It is generating a bit of Oscar buzz.

Why didn't it make your list and what about that buzz?

GROVE: Well, the buzz is definitely there. It has eight Golden Globe nominations, more than any or film. Is it going to be a contender for Oscars no questions about. It didn't make my list for me because it didn't resonate. That doesn't mean anything, it just wasn't a picture that got to me. I think it is more a woman film than a guy's film. I think that I had trouble with these two people who barely know each other having this romance that leads the Jude Law character to walk thousands of miles back from a battlefield to find the Nicole Kidman character. But that's just me.

KING: And tell us little bit about your worst of the year.

GROVE: Ah, the worst of the year, these are the films that I didn't see, mostly. I did see the "Real Cancun," that was supposed to establish reality movies. Spring break in Cancun. It sounded tempting, actually, but it was very disappointing. But New Line, of course, has since had "Lords of the Rings" and "Elf", so they got over that pretty well.

Other films that made the worst list that I didn't see, and I'm going to tell you why, are films like "Gigli," the Ben Affleck and Jennifer Lopez film, "Lara Croft, The Cradle of Life" and Angelina Jolie, "Hollywood Homicide" with Harrison Ford, from "Justin to Kelly" that was another reality film that failed, and "Dumb and Dumberer" which was our friends at new line again, but believe me, they got over that, too.

The reason I didn't see these films is that the buzz gets along so quickly now. The buzz is just instantaneous. Instant messaging on cell phones from people who say I just saw the movie, don't waste your time or money. Internet chat rooms. Everybody is buzzing about movies and that means the old days when you could open a picture get a weekend in there before anybody knew how bad it was, those days are gone.

KING: Now, let's step back and look at the big financial picture for the industry. Reports as the year comes to a close, that perhaps revenues down, slightly but with ticket prices up that means fewer people are going to the movies.

GROVE: It does. From Hollywood's point of view it isn't so much an industry wide story because this is an industry made up of different studios. Go over to Disney, and ask them what they think of 2003 and they're going to be very happy. They got $340 million of box office domestically on "Fining Nemo." They got $305 million on "Pirates of the Caribbean." Disney is very, very pleased.

Go ask our corporate cousins as at New Line Cinema, they're going to tell you it's a great year. Lords of the Rings has already done about 224 million. It's heading to 300 million and that's just domestic. You look at "Elf" huge holiday season hit. The film cost in the low 30 millions and it's done $165 million.

KING: You mentioned technology, instant messaging, cellphones as a way for people to clear the duds if you will, keep the audience out.

What about the impact of piracy?

Is another form of technology nefarious in technology, does that affect numbers?

GROVE: Well, piracy certainly hurts business. But it's more of a factor outside the U.S. Now, you can walk around in New York and buy pirated DVDs, there's no question of it. But it's when you are in other countries internationally that you find the stacks of pirated DVDs, often of films that are not playing yet in theaters in their countries. So one of things Hollywood did in '03 was to go day and date. In other words open domestically in the U.S. And Canada and open internationally the same date. And that sort of cuts out a lot of the piracy because then people in these various international countries can see it in a theater the way they're meant to see it.

KING: Any one thing you're looking forward to in the new year?

GROVE: Looking forward to seeing good movies in the new year. The best thing is we don't necessarily know which ones will be the good ones but you look at elements on paper they all look good. But as we have found in 03, they're not all good.

KING: Marty Grove, "Hollywood Reporter", thank you.

GROVE: A pleasure.

(END VIDEOTAPE)

KING: "Tonight's Quote" is from New York. Where we have been reporting local, state and federal officials are gearing up for tonight's celebration.

"We live in a dangerous world and we are trying to make sure that if we are making a mistake it's on the side of being overly cautious." That from New York City Major Michael Bloomberg.

A reminder to vote in "Tonight's Poll." Have fears of an attack and the heightened security caused you to alter your plans for New Year's Eve, yes or no?

Cast your vote at cnn.com/lou.

We'll bring you the results later in the show.

Coming up -- "America's Bright Future." Tonight, two brothers and their award-winning study of the deadly West Nile Virus. These are not your typical high school students.

Bill Tucker will have their story.

But first, "Exporting America." Each night we're updating a list of U.S. Companies our staff has confirmed to be exporting American jobs to cheaper, overseas labor markets. Today's editions are Computer Associates and Thrivent Financial. We will tonight update the list every night. Please send us the names of companies you know to be exporting American jobs to cheap overseas labor markets. The e- mail address again, loudobbs@cnn.com.

We'll be right back.

(COMMERCIAL BREAK)

KING: Now for a look at some of your thoughts.

From Sacramento, California: "The recent ban on ephedra is amazing to me. The federal government, as well as the FDA, know without a doubt that both alcohol and tobacco kill, and have killed millions of people. Yet, these remain legal. Am I the only one that sees this hypocrisy?"

And from Cambridge, Massachusetts: "This current ephedra ban makes no sense. Any substance can be abused and the consequences disastrous. The consumer must be responsible no matter what they purchase. The public apparently isn't willing to have the federal government ban liquor, and the government would lose a significant amount of tax money."

And from Puerta La Cruz, Venezuela: "Seems the government was kind of quick to ban the diet supplement ephedra, because it was supposed to be linked to 100 deaths. Why does the government not have the intestinal fortitude to ban tobacco, as I'm sure over the years it has killed more than 100."

And from Prescott Valley, Arizona: "So the FDA now claims the right to stop sales of ephedra products even though literally millions of people safely take these products. Your chance of being struck by lightning is much more likely than being in any way injured by appropriate use of ephedra products. This is just one more government step toward taking away our personal freedom of choice under the guise of public safety and protection."

We appreciate always hearing your thoughts. Send us an e-mail at loudobbs@cnn.com.

And turning now to the markets and what has been a very strong year for stocks. All of the major indexes closed out 2003 with solid gains. As for today, the Dow added another 28, the Nasdaq lost 6, but still ended above the 2,000 mark. The S&P gained 2.

Mary Snow is here now with a look at some of Wall Street's biggest winners and losers this past year -- Mary. MARY SNOW, CNNfn CORRESPONDENT: Well, John, investors got ready to ring in 2004 with a dose of good news about the jobs market. Weekly jobless claims fell to their lowest level since President Bush took office. The outlook for the workforce is key not only to the pace of the economic recovery, but to the political landscape for 2004.

Another big theme for the market in 2004 will be the declining dollar, as the euro closed out the year with a record high. But stocks finished in the plus column for the first time since 1999, and the last time stocks gained after three down years was back in 1942.

For the year, the Dow Jones Industrial Average rallied 25 percent, or 2,112 points. The Nasdaq, the big winner, jumped 50 percent, and the S&P 500 gained 26 percent.

Gains were broad based, but it's no surprise that tech name tops the list of Dow winners. Intel surged 106 percent. Caterpillar came in second, up 86 percent, followed by Alcoa Aluminum and McDonald's.

The biggest Dow decliners -- Eastman Kodak tops the list, down 23 percent, as the company tries to refocus itself. AT&T followed, and drug stocks, Merck and Johnson & Johnson, also were in the minus column -- John.

KING: Thank you, Mary. And a happy new year to you.

SNOW: You too.

KING: ... and we wish the markets as well. Thank you.

Coming up -- "America's Bright Future." Tonight, two teenage brothers who have made tremendous strides in the study of the West Nile Virus. Not exactly your typical teenagers. Bill Tucker will have their story.

(COMMERCIAL BREAK)

KING: Now the results of tonight's poll. Fourteen percent of you said yes, you have altered your plans for New Year's Eve. Eighty- six percent said no.

In "America's Bright Future" tonight, two brothers who have chosen to leave more typical teenage activities behind in order to do extensive research on the West Nile Virus. So far, their decision is paying off. Their research won the top prize in the Seimens Westinghouse Math, Science and Technology Competition this year. Bill Tucker has their story from South Windsor, Connecticut.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): How many teenage boys do you know building analytical models of the spread of West Nile Virus? Meet Mark and Jeffrey Schneider, two brothers who set aside sports, girls and teenage angst, all to humor their mom. Sandy Schneider was worried her boys would contract West Nile Virus. Hoping to put her mind at ease, the brothers launched into a study on how the disease was spread, with Mark presenting the theory and Jeff modeling the research.

JEFFREY SCHNEIDER: We really couldn't have accomplished the project unless we both worked on it, because I wasn't sure how to go about with the theory of the West Nile Virus and he wasn't exactly sure how to go about programming it into a computer.

MARK SCHNEIDER: Yeah, so we needed each other.

TUCKER: A senior in high school, Mark is the Renaissance man, a bundle of kinetic energy. When he's not busy advancing public health policy, he sketches friends, celebrities or anyone else that appears in his mine's eye.

M. SCHNEIDER: That face, and such a simple drawing, really embodies the genius of Rembrandt's work.

TUCKER: Mark is also a novelist. He published a book about semi-pro baseball, set in the 1930s.

Jeff, two years younger, is more methodical. He spends a lot of time on his computer and loves the logic of chess. And like his brother, he's also a huge baseball fan.

J. SCHNEIDER: A lot of people say baseball's really boring, and I try to think that there's really a strategy behind it, and that's why they pay the managers and the pitching coaches and the hitting coaches so much money.

TUCKER: In a rare display of teenage emotion, the brothers will admit that the best part of the project was the time spent together.

J. SCHNEIDER: Looking back, it was a pretty good experience, because I was working with Mark, I wasn't just locked in my room away with a computer just staring at a screen, and we also had good humor working with it.

TUCKER: Mark and Jeffrey share an upbringing that taught them to not just do well, but to also do good.

M. SCHNEIDER: Every morning I thank God I'm alive, and think I have the opportunities to -- that I've had and I've been fortunate as I have had.

MICHELE QUINN, SCHOOL COUNSELOR: With students like Mark and Jeff, the opportunities are endless, because even if a block comes up one way, they know there's another street they can turn down.

TUCKER: Bill Tucker, CNN, South Windsor, Connecticut.

(END VIDEOTAPE)

KING: That's our show tonight. Thanks for spending time with us. As we leave you tonight, we want to take a moment to acknowledge everyone here at CNN New York. And for all of us here, good night from New York. And from all of us, please have a safe and a happy new year.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com







Aired December 31, 2003 - 18:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
ANNOUNCER: New Year's Eve on high alert. Millions of Americans will ring in the new year under unprecedented security. We'll have live reports from Times Square in New York city and Washington. We'll talk with the police chiefs of Miami and Seattle.

In "Broken Borders" tonight, the new year will bring a new system for tracking foreign visitors to this country. Lisa Sylvester will report on whether the massive overhaul will make Americans any safer.

2004, the year that many Democrats have been waiting for is here. On the eve of what's sure to be a contentious election year, Ron Brownstein of the "Los Angeles Times" and Karen Tumulty of "TIME" magazine will join us for a political roundtable.

America's bright future, two Connecticut brothers whose research on the West Nile virus has brought us just a little closer to understanding the mysterious disease. Bill Tucker will have their story.

And this year's hits and misses at the box office. Martin Grove with the "Hollywood Reporter" will join us with his picks of the best and worst movies of 2003.

ANNOUNCER: This is LOU DOBBS TONIGHT for Wednesday, December 31. Sitting in for Lou Dobbs, who's on vacation, John King.

(END VIDEOTAPE)

JOHN KING, GUEST HOST: Good evening. Tonight the new year is approaching amid new warnings of possible terrorist attack and cities and towns across the country are taking extraordinary steps to make sure Americans celebrate safely.

(BEGIN VIDEOTAPE)

KING (voice-over): High alert at the dawn of the new year, celebrations, despite government warnings of possible terrorist attacks.

PASQUALE D'AMURO, NEW YORK FBI DIRECTOR: Some of the threats that we've been dealing with recently have a higher level of credibility so that causes us additional concern.

KING: New York's Times Square is one scene of unprecedented security. A city targeted before, taking extra precautions even as top officials urge revelers to enjoy the big night.

COMMISSIONER RAY KELLY, N.Y. CITY POLICE DEPT.: There's chatter about biological, chemical, radiological events possibly happening so it's something that we're concerned about.

KING: In Chicago, a greater police presence with the main event at Navy Pier and restrictions on flights in the skies above. A ten- mile no-fly zone has been ordered over Las Vegas where military aircraft will patrol as part of the stepped up security over the city's famous and festive strip.

GOVERNOR KENNY GUINN (R), NEVADA: This is a first time but in our planning we kind of felt like America has certainly changed and the world has changed, and we have to change with that.

KING: More police on hand for Boston's first night celebration. And these metal trash containers are being replaced with cardboard boxes to minimize the damage in case of an explosion. The Rose Bowl is one of several security priorities on New Years Day. Skies over the football game restricted and thousands of police assigned to the route of the annual Rose Bowl parade.

CHIEF BERNARD MELEKIAN, PASADENA POLICE: We're very confident that there's no specific threat against Pasadena or the events.

KING: Overseas, Australia kicked off a day of worldwide celebration amid heightened security. And hours later, the clock hit midnight in Moscow. In Baghdad, a new year but sadly a familiar sight. A deadly terror strike at a restaurant where patrons were celebrating the dawn of 2004.

(END VIDEOTAPE)

KING: This unprecedented security comes as a result of intelligence suggesting terrorists are planning an attack here in the United States. Joining us with more is justice correspondent Kelli Arena in Washington. Kelly, from your sources tonight, what is the latest on the threat?

KELLI ARENA, CNN JUSTICE CORRESPONDENT: John, the threat information has been very general in nature, although we have heard information about very familiar cities, Los Angeles, New York, Washington D.C., Chicago, Las Vegas. That is -- those are cities that are named within the chatter.

None of it is very specific. There's no specific target that's been mentioned, no specific method of attack. However, as you mentioned in your report, you interviewed Pat D'Amuro who is one of the nation's top counterterrorism officials. He is the man who runs the New York FBI field office.

As Pat said, the information this time is a little more credible. I can tell you that our sources have told us that some of the information regarding New Year's has come from an informant who has worked with counterterrorism officials before, who has provided reliable information, so this takes it beyond the level of just anonymous chatter. This is actually coming from someone that is a known source.

And the volume of information is what is a concern as well. It corroborates each other. What they hear from one part of the world, they are hearing very similar information from another part of the world. Take that altogether, put it into the threatened matrix that is put together every day, and you have a very high level of concern. But, again, nothing that they can actually pinpoint, John.

KING: That must be frustrating, Kelli, nothing site-specific or a specific type of attack.

ARENA: That's right. As every counterterrorism official will tell you, this is more an art than it is a science. What analysts are doing behind the scenes is taking these bits of information, we all heard a lot after 9/11 about not connecting the dots, about an inability to see the bigger picture. Well, now, what you have is just the opposite.

You have little bits of information that are being tied together by analysts who are looking at things that the intelligence doesn't necessarily get you to say a specific event happening in Las Vegas, for example.

But little bits of information put together can lead someone to surmise, well, maybe this is what this is talking about, and so you have leaps that are being taken which sometimes can cause a problem because when leaps are taken, it's very hard to act on things that are not concrete but it does add to sort of a frenzy that can occur and a frenzy is not what anybody wants at this point.

KING: Kelli Arena for us tonight in Washington. Thank you very much, Kelli.

ARENA: You're welcome, John.

KING: The debate over how Americans should respond to the nation's heightened terror alert was stoked today here in New York when a prominent member of Congress urged people to stay away from Times Square and other large gatherings. Among hundreds of thousands of people ignoring that advice is Peter Viles -- Peter.

PETER VILES, CNN CORRESPONDENT: John, that congressman, Christopher Shays of Connecticut, set off an immediate firestorm when he said yesterday, and this is a quote, "you've got to be a fool to do what we did tonight, which is to come to Times Square on New Year's Eve.

(BEGIN VIDEOTAPE)

VILES (voice-over): As New York woke to the headline "On Guard," and news of the tightest security in the city's history, a Connecticut congressman said what others certainly must have been thinking.

REP. CHRISTOPHER SHAYS (R), CONNECTICUT: You've got to be a fool, frankly, to go on New Year's night to Times Square. I can't understand why people do that. Just one hand grenade thrown in the air and people panicking. It's too tempting a target. Maybe you want to say we're going to survive and nobody's going to get -- but why put yourself in that position?

VILES: In New York, the mayor and the police commissioner took exception, saying their city is safe and a great place to celebrate.

MAYOR MICHAEL BLOOMBERG, NEW YORK CITY: I want to urge everyone to leave the worrying to the professionals. That's what these security levels are for. They're for professionals. The rest of us, let's go to Times Square. It's going to be a fantastic night. A great beginning to a wonderful 2004.

VILES: The back and forth raised a serious issue. How useful is government advice that says don't change your travel plans, but be ready, be on alert because the risk of an attack is high?

HELEN MORRISON M.D., PSYCHIATRIST: It's a conflicting message, but we get that message in almost everything we do, eating beef, smoking, going to the beach, driving a car, getting in an airplane. But those things we tend to know what the risks are. With terrorism, it's such a very vague threat.

VILES: Congressman Shays drew criticism partly because he took that "vague threat" and made it specific to Times Square.

BRUCE SCHNEIER, AUTHOR, "BEYOND FEAR": I think it is alarmist. I think avoiding places where terrorists might strike is ridiculous. They might strike everywhere, they might strike anywhere. They're likely going strike nowhere. If you're going to Times Square, you should dress for the weather, you should worry about pickpockets. After that, everything is else is in the noise.

(END VIDEOTAPE)

VILES: Well, the noise, John, is starting to pick up here. The crowd picking up. Extremely tight security. It took us quite a while to get in here. It's almost like trying to get on to an airplane. But the weather's fine, probably about 40 degrees. I've always wondered what do these people do for six hours? It's six hours now to midnight. They're having a great time. There's a band playing. They just raised the ball so a very festive feeling here, John, in Times Square.

KING: Well, Pete, tell us a little bit more about that security as you get closer to Times Square. I assume the security gets tighter. What do you have to go through? Is it magnetometers, bags being searched, what exactly is happening?

VILES: Bags are being searched. They're doing it one at a time. It's very slow. I'd be surprised if they get everybody in here who's on line right now trying to get into here.

But they do use the same wands they use in an airport over your entire body. They'll ask you to open up bags and such. It's very orderly. There's no place where there are a lot of people coming here. It's one at a time. Two police officers searching each one person at least, in the entrances we looked at on our way in here, John.

KING: Peter Viles for us tonight in what looks like an already festive Times Square. Take care, Peter. Thank you.

And joining me now for more on this heightened security this New Year's Eve are the police chiefs of two major American cities. John Timoney is the chief of police in Miami and Gil Kerlikowske is Seattle's police chief. Gentlemen, thank you both for joining us tonight.

I will begin with you, Chief Timoney and ask you both. What about the point raised by Congressman Christopher Shays today. Would the government be doing you a favor, sir, if it said, stay home, this nation is under risk of terrorist attack, do not gather in a large public place?

CHIEF JOHN TIMONEY, MIAMI POLICE DEPARTMENT: No, I don't think so. I think the Congressman is wrong in this case. Life has changed post-September 11 and we're a lot more like Britain over the last 30 years with I.R.A. Threats, where they've had so many close-downs, a whole host of lifetime interruptions, if you will.

It's something we're going to have to get used to. As much as humanly possible, people should resume normal activities and particularly on New Year's Eve. Times Square, I spent 29 years -- a lot of nights up in Times Square on New Year's Eve, it's the best place in the world to be and Mayor Bloomberg's right, people should come and not hesitate to come.

KING: Chief I assume you believe the Space Needle is the second best place in the world to be, then?

CHIEF R. GIL KERLIKOWSKE, SEATTLE POLICE DEPT.: I do. The Space Needle, of course, is one of the most protected sites. It a large venue in our area called Seattle Center. The police department has taken extraordinary steps particularly after the millennium celebration was canceled here in 1999. So we have a good plan in place. We have a lot of people on duty. People should come out and enjoy themselves. I also agree with John that congressman was offbase on that. We cannot -- we know that we're in a different world after 9/11 but we need to go ahead and adapt and as Mayor Bloomberg said, and as our mayor said, leave the worrying to the professionals.

KING: Let me stay with you, Chief Kerlikowske, then come back to Chief Timoney, there are have been complaints in past when the alert level goes up you're not getting specific information about the threat. Share with us this experience and as you answer, sir, each of you, any particular specific threat in your city?

KERLIKOWSKE: I have to tell you, first, secretary ridge has unbelievably responsive to the concerns raised by first responders, by local law enforcement and other public safety officials. And this time when the alert level was raised we were on a conference call on a Sunday morning with the secretary and many others. We had the information in advance. They were as specific as they could be. And they're very much -- and I can understand not wanting to heighten the alarm but also wanting to make sure that the people that are so-to- respond first, which is local law enforcement, has the information.

KING: Do you achieve, chief?

TIMONEY: Absolutely. The other thing, you know, there are a lot of people, naysayers that complain about the raising of the alert system as if it's happening every other week. It's not. The last time it was March 17. And so I think Governor Ridge is getting a bad wrap for this. It's been twice this year it's been raised. It is an inconvenience. Often it isn't specific. What I can tell you is, I find it in some way comforting to remind us that we still have an enemy out there. Our biggest enemy, if you will is complacency, both from a police perspective and also the public. That the further we get away from 9/11, the safer we feel. That may be a false sense of security and these alerts remain us constantly there's someone out there to worry about.

KING: And I'd to ask each of you this question. We focus a great deal on aviation security.

Chief Timoney beginning with you, what else is it you're being told to watch out for?

Does that mean targeting things like sports stadiums, you have bowl games this weekend, does it mean targeting hotels, suicide bombers?

TIMONEY: We have a Christmas village down here in Miami, those big festivities tonight. Tomorrow we have the Orange Bowl. And any event that has a large gathering of people gives a terrorist what he needs. Symbolism and a high body count. And so you have to have extra police presence, particularly uniformed presence, at these venues. As Governor Ridge pointed out last Saturday, it looks like according to the chatter, the airplane is the preferred vehicle as a weapon.

KING: Chief

KERLIKOWSKE: Well, I think we need to be open and make sure we're not just focusing in on any particular threat. Because remember, there's been no specific threat to a venue within the United States and there hasn't been a specific method of attack though, as you said, aviation comes up. Recently, in fact, this summer, Seattle participated in a program or an exercise called top-off. It was the largest counterterrorism exercise in the nation's history. That was a radiological dispersion device or a dirty bomb. Chicago also participated in that, and with a biological threat. So we want to make sure we're being as flexible and as open and as understanding of what all of the threats may be.

KING: Chief Gil Kerlikowske in Seattle and John Timoney in Miami, gentleman, thank you both for joining us and best of luck.

TIMONEY: Thank you, John, happy New Year.

KING: Happy New Year. Good luck to both of you this weekend. That brings us to "Tonight's Poll" question, have fears of an attack and the heightened security caused you to alter your plans for New Year's Eve, yes or no?

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

And coming up, more violence in Baghdad today. A deadly reminder of the work still to be done in Iraq.

The Pentagon correspondent Barbara Starr will report on what lies ahead for the coalition.

Then, new controversial security measures. A plan to track foreigners in the United States. Lisa Sylvester will have that report.

And the best and worst movies to hit the big screen this year. Martin Grove, columnist for the "Hollywood Reporter" will join us with his list of box office winners and losers.

(COMMERCIAL BREAK)

KING: A harsh reminder today there's still a war it Iraq. At least five Iraqis were killed and dozens injured when a large explosion ripped through a restaurant in central Baghdad where people were celebrating New Year's Eve. Iraqi police said the source was a car bomb. The restaurant is popular among westerners and had been advertised a New Year's Eve celebration. The U.S. Military had been on heightened alert, fearing injure gents would launch an attack around the holidays.

Today's blast is the latest reminder of the hurdles to peace that remain in Iraq.

Barbara Starr takes a look at some of the most pressing issue for Iraq and the U.S.-led coalition.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): By June, there is to be a new Iraqi led transitional government with full powers, key to moving beyond the war, the occupation, and the violence that has torn the country apart. The coalition's provisional authority and the Iraq Governing Council will dissolve. By December 2005, elections for a new permanent government. U.S. officials are working frantically to make all of that happen.

RICHARD BOUCHER, STATE DEPT. SPOKESMAN: Really what they're talking about at this point is working to plan the political transition in Iraq. Talking about how to support a U.N. role in that process.

STARR: But the most important hurdle, security. Plans call for Iraq to have its own quarter million manned security force. Police, army, civil defense, and facilities protection. But reality is grim. Bombing attacks against Iraqi police continue, army troops have left, complaining of low pay, perhaps half of the security forces fully trained and equipped. The U.S. plan to put people on the street quickly, a move still defended.

BRIG. GEN. MARK KIMMITT: I think on balance, the commanders would come back and say the decision to not wait until we had the perfect solution was the wise one, the prudent one, and one that's probably saved a significant amount of coalition lives in the process.

STARR: The new government must show it can bring Saddam Hussein to trial. So far, it's not clear if the U.S. will have a role. Economic issues must also be resolved. How to award nearly $20 billion in reconstruction contracts, already controversial because the U.S. will not let countries opposed to the war bid on prime contracts.

Defense Secretary Donald Rumsfeld remains defensive.

DONALD RUMSFELD, DEFENSE SECRETARY: So everyone's clear, the United States did not ban any company from doing anything.

STARR: But the whole reconstruction effort now badly behind schedule. One area that is working out, debt forgiveness for much of the $120 billion in red ink run up by Saddam Hussein's regime. France, Germany and the U.S. have an agreement in principle to have that debt written off. A new Iraqi government, a secure environment, and a healthy economy, all challenges to be faced in Iraq in 2004. Barbara Starr, CNN, the Pentagon.

(END VIDEOTAPE)

KING: And one of the major challenges facing the United States and Iraq is, of course, rebuilding that country's infrastructure. And word tonight, that monumental task may be partially delayed. According to a senior administration official, $4 billion worth of rebuilding work in Iraq may be deferred.

When asked whether the money's being reserved for France, Germany, or Russia, the official said U.S. policy regarding their access to major reconstruction contracts has not changed. The three countries are now barred from that process.

Separately, tonight, a U.S. military energy unit said it would take over soon the job of getting fuel into Iraq ending a deal with Halliburton. The decision follows a draft Pentagon audit showing the firm overcharged for the job. Halliburton strongly denies any wrongdoing.

An incredible story now of survival in the rubble of the Iran earthquake. A baby and a young girl were pulled from the rubble in the city of Bam five days after the powerful earthquake. Rescuers also saved three others.

Those buried beneath buildings typically survive only three days, at most. More than 80 U.S. medical workers opened a field hospital in Bam, yesterday, joining medics from more than 20 countries to treat thousands of wounded. Late today, U.S. officials lifted some banking restrictions against Iran to make it easier for donations to reach survivors. At least 28,000 people were killed in that earthquake.

And coming up, tracking foreigners in this country. New controversial security measures go into effect on Monday. Lisa Sylvester will report.

And the year of politics. Looking back at 2003 and ahead to 2004. Ron Brownstein of the "Los Angeles Times" and Karen Tumulty of "TIME" magazine will join us.

(COMMERCIAL BREAK)

ANNOUNCER: LOU DOBBS TONIGHT continues. Now, "Broken Borders."

KING: The new year marks the start of a new program for the Department of Homeland Security. It's a system designed to identify foreign visa holders entering the United States. The goal, to make sure those who enter this country, leave as scheduled. Lisa Sylvester reports.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT: Three of the 9/11 hijackers overstayed their visas but because the United States did not have an adequate entry/exit tracking system, investigators had no way of knowing that.

ASA HUTCHINSON, UNDERSECRETARY, BORDER AND TRANSPORTATION SECRETARY, DEPT. OF HOMELAND SECURITY: America wants to know that whenever a foreign visitor comes into the United States that they leave on time and if they don't leave on time we know about it because that's a security risk. It gives us that capability.

SYLVESTER: U.S.-VISIT goes into effect Monday at 113 airports and 14 seaports. Foreign visitors requiring visas will be photographed and fingerprinted. When they leave the country, they are required to formally check out. People who overstay their visas will have a harder time returning to the United States in the future.

But there are limitations. The program only applies to people required to have visas. That excludes visitors from 28 countries, including Canada, and most of Europe. British shoe bomber suspect Richard Reid, for instance, traveling from France, would not have been part of the database.

RICHARD NORTON, NATIONAL BIOMETRICS SECURITY PROJECT: Probably over 80 percent of all of our tourists come from visa waiver countries. But they won't have to go through that process.

SYLVESTER: Other concerns, potential glitches could interrupt legitimate travel in commerce, issues over privacy and there could be false positives.

STEPHEN FLYNN, COUNCIL ON FOREIGN RELATIONS: Somebody comes in and we mistakenly believe they're a terrorist or we mistakenly don't recognize them as a terrorist and then that creates real challenges of confidence in the system.

SYLVESTER: And getting people to check out when they leave the country by land is a little tricky. Right now there are checkpoints when people drive into the country. But there are no procedures to stop people when they drive out. Lisa Sylvester, CNN, Washington.

(END VIDEOTAPE)

KING: For the second time in a week the body of a stowaway has been found in the wheel well of a jet at Kennedy airport here in New York. Police discovered a man's body after a British Airways flight from London landed yesterday evening. Nigerian currency was found on the corpse. British Airways says the plane was in Nigeria on December 22. On Christmas Eve, JFK workers found the body of a man in the wheel well of an American Airlines flight from Jamaica.

Coming up, timing the United States' exit from Iraq. A delicate issue for the president and his opponents in the race for the White House. We'll have that story. And Ron Brownstein of the "Los Angeles Times" and Karen Tumulty of "TIME" magazine will join us.

And the year on Wall Street. Mary Snow will take a look at the best and worst of the markets in 2003. Stay with us.

(COMMERCIAL BREAK)

KING: The car bomb that killed at least five people at a Baghdad restaurant today is a reminder that U.S. forces' job there is far from done. The Bush administration would like to reduce military levels in Iraq in the coming year and Democrats are sure to make that progress or lack of progress in Iraq a major campaign issue.

(BEGIN VIDEOTAPE)

KING (voice-over): Laying out an exit strategy for Iraq will be a key challenge in the campaign year just ahead.

JOHN PODESTA, FORMER CLINTON CHIEF OF STAFF: I think that the president really hasn't explained any strategy in terms of the long run. I think they're kind of weighing it day by day and, you know, kind of hoping for the best.

KING: The administration hopes to reduce the number of U.S. troops in Iraq over the course of the election year. There are no guarantees.

DAN BARTLETT, WHITE HOUSE COMMUNICATIONS DIRECTOR: His decision making will be based upon those recommendations by military commanders, not by politics.

KING: A certain Democratic campaign theme will be that while Mr. Bush won the war, he has lost the peace.

PETER HART, DEMOCRATIC POLLSTER: Too many American soldiers killed or wounded. The public is uncertain about the price that we're paying for this war.

KING: Allies of the president concede the price of war in both lives and money will be a sensitive campaign issue.

BILL MCINTURFF, REPUBLICAN POLLSTER: The American electorate has demonstrated a certain limited tolerance of how much money they want to spend in Iraq. I think that they're very clear they want us to find a way out of that country.

KING: The president says he cannot say when U.S. troops will leave Iraq, because so many questions are yet to be answered, including the pace of training a new Iraqi army.

LAWRENCE EAGLEBURGER, FORMER SECRETARY OF STATE: I think there needs to be more of that telling the American people why we're there and why we have to stay there until it's done right.

KING: To Democrats, done right would mean more international help, instead of an overwhelmingly American military force in Iraq.

MCINTURFF: I think it's a debate George Bush could win and should win for this country's stability, but that's, you know, that's why God made campaigns and that's why they are going to be front and center of the 2004 campaign.

(END VIDEOTAPE)

KING: And after all the buildup and anticipation, the season's finally upon us. No, not the traditional holidays -- the primaries and caucuses. Next month, Democratic voters will start paring down their field of contenders, first in Iowa, then in New Hampshire. For more on the political year ahead, and a little bit maybe on the year just passed, I'm joined by Ron Brownstein of "The Los Angeles Times" and Karen Tumulty of "Time" magazine. Thank you both for joining us on this New Year's Eve.

Let's start on the point of that piece just a moment ago. Ron, how can this president enter an election year without an exit strategy? He says, of course, he can't answer that question just yet. But will it be a major issue?

RON BROWNSTEIN, "L.A. TIMES": It will be a major issue. A central focus of the campaign. I don't know if he needs an exit strategy in the sense of guaranteeing to the American people that the soldiers will be home by X date or certainly before the election day itself. What he needs, though, is a sense of progress, John, I think that is the key variable here.

The public I think is much more willing to accept casualties and violence in Iraq if they see us progressing toward the goal of a stable Iraq that would become a source of stability in the entire region. And that's really what he needs. He has the timetable for moving toward Iraqi self-governance next summer. I think he needs progress on those fronts, and some evidence that the violence is tamping down. KING: And Karen, how the Democrats handle that question will, of course, depend on whether their nominee is a war opponent, like Governor Dean, or someone who voted to support the war. Will it not?

KAREN TUMULTY, TIME MAGAZINE: It will, but you know, even among the Democrats, at least among the top tier candidates, you really don't have anyone who's arguing for bringing the troops home at any particular date certain. So certainly if things continue, if things in Iraq continue to have their rough spots, the Democratic candidates are going to jump on that and call as much attention to that as possible. But right now, we really haven't seen much of a specific strategy for many of them, beyond the idea that they would like to see it internationalized.

KING: Let's move on to one of the themes of this week, Governor Dean saying that the Democrats need to back off, that he might be the nominee, they should stop criticizing him, appealing for help from the party chairman, Terry McAuliffe. Listen quickly to why Governor Dean says it's so important that his rivals stop criticizing him.

(BEGIN VIDEO CLIP)

HOWARD DEAN (D), PRESIDENTIAL CANDIDATE: I think that the other guys are so obsessed with our campaign that they're not running a positive campaign. I don't think we can beat George Bush without running a positive campaign. We're going to continue to run a positive campaign.

(END VIDEO CLIP)

KING: Karen, weigh in on that one, will you? Is that whining from Governor Dean?

TUMULTY: Well, there is a, first of all, a certain amount of presumption in there that, you know, he is going to be the nominee and therefore everybody ought to back off. But the fact is that all year long it's been Dean who's been most aggressive in criticizing the others in the race, particularly those who are in Washington, and as being unable and unwilling to stand up to George Bush. So it is a bit like, you know, the schoolyard tough all of a sudden complaining that the little kids are kicking sand in his face.

KING: Ron, does that comment from Governor Dean and his theme throughout the week, does it support what the Republicans are saying, that they will run against someone who is negative, someone who is reflexive, who shoots from the lip, if you will?

BROWNSTEIN: Yeah, they will. I mean, if Dean is the nominee, clearly Republicans believe that this temperament will be as much of an issue as his ideology. I mean, I agree with Karen, it's kind of a silly complaint from Dean. Really, on two fronts. First, as Karen said, he's been criticizing other Democrats all year. He ran an ad in Iowa criticizing Dick Gephardt on the war. I mean, he's the only one to run a television ad directly by a campaign.

Secondly, he doesn't need the intervention. I mean, he has a very strong base of support, and as he's shown he has a pretty tart tongue. He's perfectly capable of defending himself, but clearly what his rivals believe is a principal vulnerability in the general election, and what the Republicans believe could be a principal vulnerability in a general election is this tendency to say things sometimes before he has fully thought them through. He's spent a lot of time apologizing and clarifying in this campaign, and that will become more of a vulnerability if he does become the nominee.

KING: Our discussions on these issues for weeks if not months have been largely theory and are somewhat speculative, because nobody's voted yet. But let's take a quick look at the calendar. We are 19 days away from the caucuses in Iowa, 20 days away from the president's State of the Union address, 27 or 28 days, depending on how good my math is, from the New Hampshire primary, and then, of course, we move on a week after that to the South Carolina primary. Ron Brownstein, what's about to happen?

BROWNSTEIN: John, in fact, we're about 5 1/2 hours away from people in Michigan being allowed to go online to the Michigan Democratic Party and download ballots that will count, and request ballots. People will start voting there, in early voting that they have for their February 7 caucus next week, in large numbers.

Essentially, this whole race is moving from the hands of the fund-raisers, the strategists and the pundits to the voters, and there are always some surprises along the way.

Clearly the stakes are very high now for the other candidates. Howard Dean is leading in Iowa, he's leading in New Hampshire, he looks good in a number of the February 3 states. He looks especially good in the states after February 3. Someone has to find a way to interrupt this dynamic, to change the basic flow of the race, by surprising, maybe not even beating him in Iowa and New Hampshire, but by changing the expected order.

John Kerry, a surprise second in Iowa. Wesley Clark a surprise second in New Hampshire. Someone has got to find a way to change the dynamic very soon.

KING: Karen, as you weigh in, (UNINTELLIGIBLE) Dick Gephardt. He has to win in Iowa and he has to win big, right?

TUMULTY: And in fact, Dick Gephardt is truly the first speed bump that Howard Dean has to clear. The fact is that he more than any other candidate in this race stands a chance of putting a nick in Howard Dean, slowing him down, at a moment when once again we're getting the first fund-raising numbers from this quarter that suggest that Dean and Clark are really, really the only two guys who seem to be maintaining any sort of financial momentum.

BROWNSTEIN: One critical question, John, quickly, in the next 18 days, does Dick Gephardt go on the air in Iowa criticizing Howard Dean either on trade, most likely, or on Medicare? He seems to be a bit behind that, both sides, both the Gephardt and Dean campaign thinks that Dean has a small but stable lead in Iowa, and the question is whether Gephardt can overcome that simply through organization, or whether he's going to have to go tough on television to try to turn the tide.

KING: We need to end our last discussion of the old year on that point. We'll resume this in the new year, no doubt, with a little bit more information at our disposal. Ron Brownstein of "The L.A. Times," Karen Tumulty of "Time" magazine, thank you so much. And a happy new year to you both.

BROWNSTEIN: Happy new year.

TUMULTY: Happy new year.

KING: Thank you.

And that brings us to tonight's thought, on the eve of the new year.

Quote: "The best thing about the future is that it comes only one day at a time." That from Abraham Lincoln.

And coming up -- the biggest hits and misses to hit the big screen in 2003. Martin Grove, columnist for "The Hollywood Reporter," will join us with his big winners and losers for the year.

(COMMERCIAL BREAK)

KING: The final two weeks of the year are among the busiest when it comes to the movies. So if you're thinking about a movie or two in the days ahead, a few pointers now from "The Hollywood Reporter's" Marty Grove. His favorite film of the year, "Seabiscuit."

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Let's see what you've got, boy. That's it.

MARTIN GROVE, COLUMNIST, HOLLYWOOD REPORTER: Picture just scored across the board. It was a great story. So often Hollywood pays attention to the special effects it pays attention to all of the gimmicks but the story suffers. In this case, the book by Lauri Hillenbrand was a best seller and when you start with a book that's been that successful and jump off from that point, it typically helps a lot.

KING: "Lost in Translation," why on number two you put it?

GROVE: Yes, it could have been number one, certainly a close call. But two is certainly good enough. This establishes Sophia Coppola as major writer of films. It's a very, very good movie. And Bill Murray should wind up with an Oscar nomination. He already has a Golden Globe. In fact, there are five golden globe nominations for the film.

KING: I want to skip down a few on your list to the "To the Cooler," William H. Macy, in this movie in a lead role, unusual for him. Why did you like it?

GROVE: Well, William H. Macy is terrific, so by the way is Alec Baldwin. Alec Baldwin gets wrapped a lot in the press a lot. Let me tell you he's a good actor. And in this film he has good material. Everything works. This is a Las Vegas story. And we've all seen these Las Vegas stories before about the bad guys, the heavies and all of this stuff. But it shows you what that world is like and it does it in a very entertaining way. And Maria Billow who stars with them is very, very lovely and very good.

KING: "Cold Mountain" does not make your list at the moment. It is generating a bit of Oscar buzz.

Why didn't it make your list and what about that buzz?

GROVE: Well, the buzz is definitely there. It has eight Golden Globe nominations, more than any or film. Is it going to be a contender for Oscars no questions about. It didn't make my list for me because it didn't resonate. That doesn't mean anything, it just wasn't a picture that got to me. I think it is more a woman film than a guy's film. I think that I had trouble with these two people who barely know each other having this romance that leads the Jude Law character to walk thousands of miles back from a battlefield to find the Nicole Kidman character. But that's just me.

KING: And tell us little bit about your worst of the year.

GROVE: Ah, the worst of the year, these are the films that I didn't see, mostly. I did see the "Real Cancun," that was supposed to establish reality movies. Spring break in Cancun. It sounded tempting, actually, but it was very disappointing. But New Line, of course, has since had "Lords of the Rings" and "Elf", so they got over that pretty well.

Other films that made the worst list that I didn't see, and I'm going to tell you why, are films like "Gigli," the Ben Affleck and Jennifer Lopez film, "Lara Croft, The Cradle of Life" and Angelina Jolie, "Hollywood Homicide" with Harrison Ford, from "Justin to Kelly" that was another reality film that failed, and "Dumb and Dumberer" which was our friends at new line again, but believe me, they got over that, too.

The reason I didn't see these films is that the buzz gets along so quickly now. The buzz is just instantaneous. Instant messaging on cell phones from people who say I just saw the movie, don't waste your time or money. Internet chat rooms. Everybody is buzzing about movies and that means the old days when you could open a picture get a weekend in there before anybody knew how bad it was, those days are gone.

KING: Now, let's step back and look at the big financial picture for the industry. Reports as the year comes to a close, that perhaps revenues down, slightly but with ticket prices up that means fewer people are going to the movies.

GROVE: It does. From Hollywood's point of view it isn't so much an industry wide story because this is an industry made up of different studios. Go over to Disney, and ask them what they think of 2003 and they're going to be very happy. They got $340 million of box office domestically on "Fining Nemo." They got $305 million on "Pirates of the Caribbean." Disney is very, very pleased.

Go ask our corporate cousins as at New Line Cinema, they're going to tell you it's a great year. Lords of the Rings has already done about 224 million. It's heading to 300 million and that's just domestic. You look at "Elf" huge holiday season hit. The film cost in the low 30 millions and it's done $165 million.

KING: You mentioned technology, instant messaging, cellphones as a way for people to clear the duds if you will, keep the audience out.

What about the impact of piracy?

Is another form of technology nefarious in technology, does that affect numbers?

GROVE: Well, piracy certainly hurts business. But it's more of a factor outside the U.S. Now, you can walk around in New York and buy pirated DVDs, there's no question of it. But it's when you are in other countries internationally that you find the stacks of pirated DVDs, often of films that are not playing yet in theaters in their countries. So one of things Hollywood did in '03 was to go day and date. In other words open domestically in the U.S. And Canada and open internationally the same date. And that sort of cuts out a lot of the piracy because then people in these various international countries can see it in a theater the way they're meant to see it.

KING: Any one thing you're looking forward to in the new year?

GROVE: Looking forward to seeing good movies in the new year. The best thing is we don't necessarily know which ones will be the good ones but you look at elements on paper they all look good. But as we have found in 03, they're not all good.

KING: Marty Grove, "Hollywood Reporter", thank you.

GROVE: A pleasure.

(END VIDEOTAPE)

KING: "Tonight's Quote" is from New York. Where we have been reporting local, state and federal officials are gearing up for tonight's celebration.

"We live in a dangerous world and we are trying to make sure that if we are making a mistake it's on the side of being overly cautious." That from New York City Major Michael Bloomberg.

A reminder to vote in "Tonight's Poll." Have fears of an attack and the heightened security caused you to alter your plans for New Year's Eve, yes or no?

Cast your vote at cnn.com/lou.

We'll bring you the results later in the show.

Coming up -- "America's Bright Future." Tonight, two brothers and their award-winning study of the deadly West Nile Virus. These are not your typical high school students.

Bill Tucker will have their story.

But first, "Exporting America." Each night we're updating a list of U.S. Companies our staff has confirmed to be exporting American jobs to cheaper, overseas labor markets. Today's editions are Computer Associates and Thrivent Financial. We will tonight update the list every night. Please send us the names of companies you know to be exporting American jobs to cheap overseas labor markets. The e- mail address again, loudobbs@cnn.com.

We'll be right back.

(COMMERCIAL BREAK)

KING: Now for a look at some of your thoughts.

From Sacramento, California: "The recent ban on ephedra is amazing to me. The federal government, as well as the FDA, know without a doubt that both alcohol and tobacco kill, and have killed millions of people. Yet, these remain legal. Am I the only one that sees this hypocrisy?"

And from Cambridge, Massachusetts: "This current ephedra ban makes no sense. Any substance can be abused and the consequences disastrous. The consumer must be responsible no matter what they purchase. The public apparently isn't willing to have the federal government ban liquor, and the government would lose a significant amount of tax money."

And from Puerta La Cruz, Venezuela: "Seems the government was kind of quick to ban the diet supplement ephedra, because it was supposed to be linked to 100 deaths. Why does the government not have the intestinal fortitude to ban tobacco, as I'm sure over the years it has killed more than 100."

And from Prescott Valley, Arizona: "So the FDA now claims the right to stop sales of ephedra products even though literally millions of people safely take these products. Your chance of being struck by lightning is much more likely than being in any way injured by appropriate use of ephedra products. This is just one more government step toward taking away our personal freedom of choice under the guise of public safety and protection."

We appreciate always hearing your thoughts. Send us an e-mail at loudobbs@cnn.com.

And turning now to the markets and what has been a very strong year for stocks. All of the major indexes closed out 2003 with solid gains. As for today, the Dow added another 28, the Nasdaq lost 6, but still ended above the 2,000 mark. The S&P gained 2.

Mary Snow is here now with a look at some of Wall Street's biggest winners and losers this past year -- Mary. MARY SNOW, CNNfn CORRESPONDENT: Well, John, investors got ready to ring in 2004 with a dose of good news about the jobs market. Weekly jobless claims fell to their lowest level since President Bush took office. The outlook for the workforce is key not only to the pace of the economic recovery, but to the political landscape for 2004.

Another big theme for the market in 2004 will be the declining dollar, as the euro closed out the year with a record high. But stocks finished in the plus column for the first time since 1999, and the last time stocks gained after three down years was back in 1942.

For the year, the Dow Jones Industrial Average rallied 25 percent, or 2,112 points. The Nasdaq, the big winner, jumped 50 percent, and the S&P 500 gained 26 percent.

Gains were broad based, but it's no surprise that tech name tops the list of Dow winners. Intel surged 106 percent. Caterpillar came in second, up 86 percent, followed by Alcoa Aluminum and McDonald's.

The biggest Dow decliners -- Eastman Kodak tops the list, down 23 percent, as the company tries to refocus itself. AT&T followed, and drug stocks, Merck and Johnson & Johnson, also were in the minus column -- John.

KING: Thank you, Mary. And a happy new year to you.

SNOW: You too.

KING: ... and we wish the markets as well. Thank you.

Coming up -- "America's Bright Future." Tonight, two teenage brothers who have made tremendous strides in the study of the West Nile Virus. Not exactly your typical teenagers. Bill Tucker will have their story.

(COMMERCIAL BREAK)

KING: Now the results of tonight's poll. Fourteen percent of you said yes, you have altered your plans for New Year's Eve. Eighty- six percent said no.

In "America's Bright Future" tonight, two brothers who have chosen to leave more typical teenage activities behind in order to do extensive research on the West Nile Virus. So far, their decision is paying off. Their research won the top prize in the Seimens Westinghouse Math, Science and Technology Competition this year. Bill Tucker has their story from South Windsor, Connecticut.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): How many teenage boys do you know building analytical models of the spread of West Nile Virus? Meet Mark and Jeffrey Schneider, two brothers who set aside sports, girls and teenage angst, all to humor their mom. Sandy Schneider was worried her boys would contract West Nile Virus. Hoping to put her mind at ease, the brothers launched into a study on how the disease was spread, with Mark presenting the theory and Jeff modeling the research.

JEFFREY SCHNEIDER: We really couldn't have accomplished the project unless we both worked on it, because I wasn't sure how to go about with the theory of the West Nile Virus and he wasn't exactly sure how to go about programming it into a computer.

MARK SCHNEIDER: Yeah, so we needed each other.

TUCKER: A senior in high school, Mark is the Renaissance man, a bundle of kinetic energy. When he's not busy advancing public health policy, he sketches friends, celebrities or anyone else that appears in his mine's eye.

M. SCHNEIDER: That face, and such a simple drawing, really embodies the genius of Rembrandt's work.

TUCKER: Mark is also a novelist. He published a book about semi-pro baseball, set in the 1930s.

Jeff, two years younger, is more methodical. He spends a lot of time on his computer and loves the logic of chess. And like his brother, he's also a huge baseball fan.

J. SCHNEIDER: A lot of people say baseball's really boring, and I try to think that there's really a strategy behind it, and that's why they pay the managers and the pitching coaches and the hitting coaches so much money.

TUCKER: In a rare display of teenage emotion, the brothers will admit that the best part of the project was the time spent together.

J. SCHNEIDER: Looking back, it was a pretty good experience, because I was working with Mark, I wasn't just locked in my room away with a computer just staring at a screen, and we also had good humor working with it.

TUCKER: Mark and Jeffrey share an upbringing that taught them to not just do well, but to also do good.

M. SCHNEIDER: Every morning I thank God I'm alive, and think I have the opportunities to -- that I've had and I've been fortunate as I have had.

MICHELE QUINN, SCHOOL COUNSELOR: With students like Mark and Jeff, the opportunities are endless, because even if a block comes up one way, they know there's another street they can turn down.

TUCKER: Bill Tucker, CNN, South Windsor, Connecticut.

(END VIDEOTAPE)

KING: That's our show tonight. Thanks for spending time with us. As we leave you tonight, we want to take a moment to acknowledge everyone here at CNN New York. And for all of us here, good night from New York. And from all of us, please have a safe and a happy new year.

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