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CNN WOLF BLITZER REPORTS

Could Kerry Pick Republican Running Mate?; Iraqi Athletes Dream of Olympic Glory

Aired March 10, 2004 - 17:00   ET

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

(BEGIN VIDEOTAPE)
WOLF BLITZER, CNN ANCHOR (voice-over): Dream team? Could John Kerry pick a Republican running mate? It could decide the election.

President Bush defends his record.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Productivity is strong. Unemployment has been falling. Incomes are rising.

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: It seem he's the last person left in America who actually believes his failed policies will ever work.

BLITZER: Going for the gold. Losing used to mean a nightmare of torture and abuse. Now Iraqi athletes dream again of Olympic glory.

ANNOUNCER: This is WOLF BLITZER REPORTS live from Miami.

(END VIDEOTAPE)

BLITZER: In the hard hit heartland the economic recovery still somewhere around the corner. President Bush today was out there defending his economic policies, making a stand in Ohio where the jobless rate is well above the national average. Let's go live to our senior White House correspondent John King -- John.

JOHN KING, CNN SENIOR WHITE HOUSE CORRESPONDENT: Wolf, the president in this election year heading directly to the heartland and directing into the very emotional debate over trade and so-called outsourcing of American jobs to cheap overseas labor markets.

No Republican has won the White House without carrying Ohio. So that underscoring the president's, the political urgency of the president's 15th trip to Ohio as president. He toured a factory first. That factory exports 60 percent of its product. That message meant to underscore the president's key point, that he believes trade is part of a solution to a difficult jobs market, not part of the problem as many have said.

The president directly taking on his many critics. He said that yes, it is tough when people lose their jobs. He says the government must do even more to help retrain workers for new skills for the diverse and ever changing economy. But the president says his critics and how they would change the economy have it all wrong. (BEGIN VIDEO CLIP)

BUSH: Some politicians in Washington see this new challenge, but yet they want to respond in old ways. Their agenda is to increase federal taxes, to build a wall around this country and to isolate America from the rest of the world.

They never get around to explaining how higher taxes would help create a single job in America, except maybe at the IRS.

(END VIDEO CLIP)

KING: Now the president did not mention his Democratic rival Senator John Kerry by name but aides say he had Senator Kerry in mind. Senator Kerry in the past did support the North American Free Trade Agreement, did support a big trade agreement with China.

But he now says as he courts labor support that if elected president he would review all of the major trade agreements. The White House, Wolf, says that is a sign of new protectionism coming from Senator Kerry.

Wolf, if the president can win this argument, it will go a long way in determining whether or not he gets elected again. No Republican has won without carrying Ohio. The unemployment there is now 6.2 percent, well above the national average since George W. Bush became president. That state alone has lost 167,000 manufacturing jobs -- Wolf.

BLITZER: John King, at the White House. Thank you, John, very much.

An off-the-cuff remark by the Democratic presidential candidate John Kerry is drawing fire from Republicans. Our national correspondent Bob Franken has the story -- Bob.

BOB FRANKEN, CNN NATIONAL CORRESPONDENT: If anybody expected a polite campaign, Wolf, I think those expectations have been dashed. John Kerry in his formal remarks about the president and the economy said that President Bush was moving the country in the wrong direction.

But he saved his choicest words for an aside comment with one of the workers who was in the audience -- if choice is the right word.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Keep smiling.

KERRY: Aw, yeah, don't worry, man. Thank you. We're going to keep pounding, let me tell you. Just beginning to fight here.

These guys are -- these guys are the most crooked, you know, lying group that I've ever seen.

(END VIDEO CLIP) FRANKEN: It didn't take long for the Bush campaign to react with outraging saying "throughout the primary process, and obviously now, Democrats have used some of the most harsh, angry, bitter rhetoric that we have seen in our country's history."

The Republicans are saying that it is John Kerry who has charged that the Republicans are going to be engaging in a smear campaign. Republicans saying if there's any smearing, it's being done by the Democrats and John Kerry. Could get ugly, Wolf.

BLITZER: All right. Looks like it already is. Thanks very much, Bob, for that.

Is the campaign all right getting too rough? A lot of the rhetoric seems to be generated by America's ailing economy which is not generating the number and kind of jobs so many hoped for.

Joining us now from Washington is the commerce secretary, Don Evans. He also serves as the chairman of the 2000 Bush/Cheney campaign.

Mr. Secretary, thanks very much for joining us. You just heard John Kerry in a candid moment call Republicans the most crooked lying bunch he's ever seen. I wonder if you's want to comment on that?

DON EVANS, COMMERCE SECRETARY: I'm not going to dignify that with any response other than to say, Wolf, what's really important during this campaign is for Senator Kerry to be honest with the American people as to his own record and point out to them that he has voted to increase taxes some 350 times. And if there's one thing that will destroy jobs in America, it's tax increases.

The president has continued to pursue economic policies in this country that has meant a strong recovery or a recovery is getting stronger. Unemployment peaked at some 5.3 percent. Now it's 6.3 percent.

So what's going to be important is for the senator to continue to talk honestly to the American people, the kind of policies that he's going to pursue. And raising taxes or economic isolationism are not the kind of policies that are going to mean higher standards of living for Americans and more jobs here in America.

BLITZER: Mr. Secretary, at the same time, I want to put up on the screen numbers from our latest CNN/"USA Today"/Gallup poll, asking the American people whom they think would do a better job on the economy? Kerry, 50 percent, Bush, 42 percent. You know policies, you know numbers. These numbers must be a source of deep concern to you.

EVANS: Wolf, look, the election day is a long way from now. And you mention and ailing American economy. The American Economy is very strong right now.

You know, what's painful is the fact that there are people in this country that are between jobs and there's not anything more painful in a family than to not have a job. And so this president is staying very focused on the kinds of programs that will create more jobs in America and also help people through the transition.

But the economy, very optimistic about the economy. It grew at some 4.3 percent in 2003. The blue chip economic economists came out today and said it ought to grow at 7.4 percent in 2004. Productivity is very high. Home ownership are at record highs. Interest rates are at 45 year lows.

So we have a very strong economy, but we need to continue to focus on doing -- making sure we get the jobs number moving. So we are stronger.

BLITZER: And last month only 21,000 new jobs were created. Some 2.5 million jobs have been lost since the president took office. And there's a spiraling from the budget surplus for as long as the eye can see now to a budget deficit, for as long as the eye can see. Five hundred billion dollars this year alone. That would seem to suggest that there are serious economic problems out there.

EVANS: The trends on unemployment are very, very strong, Wolf, as you know. Unemployment peaked at 6.3 percent. It's down to 5.6 percent now, which is below the average of the 1970s. It's below the average of the '80s and below the average of unemployment of the 1990s.

The president has already said we're going to cut the budget deficit in half over the next five years. Although the number is higher than we would like to see it, it's a very understandable number, Wolf. I mean as we entered into office, the president was presented a recession.

The economy started declining in the second half of the year 2000. There was a recession in the first three-quarters of this was administration. We know about the horrific attacks of 9/11. We know we're at war around the world.

And so it's very understandable that you would have a deficit going through the kinds of events we have had and challenges that this administration has dealt with.

But it's comforting to know that the economy is growing very, very strong right now. And that means more revenues for the federal government. And it means that we'll see this deficit continue to decline so that within the next five years it's cut in half.

BLITZER: One final question, Mr. Secretary. Gas prices. There seems to be a spike, some record highs, especially in California. Over $2 for a gallon of gasoline, regular unleaded. What's going on?

EVANS: Well, you know, Wolf, I think what's going on right now is we're beginning to get close to the driving season. We're not there yet.

But let me say this to you. The president was very focused on energy policy when he arrived in office in January of 2001. That was very high on his agenda. He put a national energy policy together, presented it to the American people in the late spring of 2001. And has been waiting on Congress since that time to deliver him an energy bill.

And he continues to ask for it, hasn't been received yet. But needless to say, as the president said in terms of economy, a growing economy, it's very important that we have available, affordable energy for not only the consumers of America but the businesses of America.

BLITZER: Don Evans, the commerce secretary. Thanks very much for joining us, Mr. Secretary.

EVANS: Sure, Wolf. Sure, you bet.

BLITZER: Thank you.

President Bush is taking on his critics and defending economic policy. But what are his opponents saying about his speech earlier today? I'll ask John Kerry's economic adviser, the former labor secretary during the Clinton administration, Robert Reich.

A door opened or closed. What John McCain had to say about joining, potentially, John Kerry as a running mate.

And gearing up for the Summer Olympics. It's a new day for Iraqi athletes.

(COMMERCIAL BREAK)

BLITZER: Oops! They did it again. A recall in one Florida county after election officials discovered a stunning surprising front-runner. I'll tell you why some Florida election officials were surprised to find out Richard Gephardt was the favorite for Bay county voters. We're live in Florida, stay with us.

(COMMERCIAL BREAK)

BLITZER: Now an extraordinary, truly extraordinary scenario. A split ticket dream team that pairs a partisan Democrat with a GOP maverick, namely John McCain. It's still just work of the imagination, but the idea, as they say, apparently may be or has been in play. So let's play what if? Here's CNN's Brian Todd.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): The political plot thickens. Could John Kerry tap a Republican superstar as a running mate? Senator John McCain, asked point-blank if he would entertain the idea of a spot on the Democratic ticket.

SEN. JOHN MCCAIN (R), ARIZONA: It's impossible to imagine the Democratic party seeking a pro-life, free trading, nonprotectionist, deficit hawk. It's hard to imagine. They'd have to be taking some steroids.

CHARLES GIBSON, CO-ANCHOR, "GOOD MORNING AMERICA": But let me imagine it. If he asked you, if he came across the aisle and asked you, would you even entertain the idea or would you rule it out for good and ever right now? MCCAIN: John Kerry is a very close friend of mine. We've been friends for years. Obviously I would entertain it. I see no scenario, no scenario, no scenario, I foresee no scenario where that would happen.

TODD: Asked if he would campaign against Kerry if not asked to join the ticket, McCain says he'll campaign for the president of the United States. With all his disclaimers McCain's comments on "Good Morning America" leave open a fascinating scenario. A powerful bipartisan ticket taking on the Bush political machine. Is it realistic?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: If he were to go on the Democratic ticket, a lot of Democrats would say wait a minute, can this happen? When they think about it, they're likely to say, you know what? this could elect John Kerry and get George Bush out of the White House, and McCain would only be vice president. Vice presidents don't control anything.

TODD: Within hours of Senator McCain's interview, his chief of staff is quoted as saying Senator McCain will not be a candidate for vice president in 2004. A Kerry campaign official would tell us only they want to preserve the integrity of the process, and Senator Kerry has the utmost respect for Senator McCain. McCain's appeal to the likely Democratic challenger? A powerful name, the crossover draw with Republicans, and crucial swing voters. A recent CNN/"USA Today"/Gallup poll shows 13 percent of likely voters say they could change their minds on a candidate. As for McCain's reasons for accepting, however unlikely...

SCHNEIDER: He'd like to influence events to help run the country. This may be his last chance.

TODD: It offset political imaginations or what, it eight months before election day. Brian Todd, CNN, Washington.

(END VIDEOTAPE)

BLITZER: Is the split ticket scenario so unthinkable. Diehards in both parties may well die. Capitol Hill insiders are still not necessarily completely ruling it out. Joining us from Washington is Chuck Todd, editor-in-chief of the "Hotline," the national political journalist newsletter must-read in Washington and around the country every day. What are your thoughts? I know you've been doing your own reporting on this scenario?

CHUCK TODD, EDITOR-IN-CHIEF, "HOTLINE": It's amazing on how hard it is you will get -- you can't get a Shermanesque statement out of anybody on either side of the aisle. There is some Republican fear, Republicans who -- there is a Republican clique that still likes John McCain despite some rumblings around town that says Republicans aren't crazy about John McCain anymore. They're fearful that he would entertain it. That there is a friendship bond that McCain has with Kerry that he never had with President Bush. And, of course, Democrats are gleeful about it. They love the idea of McCain being floated, but they worry this is nothing more than their being set up to make McCain's endorsement of Bush matter.

BLITZER: Do you think the statement from Mark Salter, the chief of staff for John McCain in the Senate, does that completely, absolutely, positively, 100 percent close the door to this possibility?

TODD: Of course it doesn't. With all due respect to Mark Salter who did ghostwrite or co-wrote a lot of John McCain's book, his best- selling book. Until John McCain emphatically shuts the door, you're not going to ever shut Washington rumor mills up.

BLITZER: Give us a little perspective, all of us remember the bad blood, the feelings that were out there in 2000 when McCain and Bush ran for the Republican presidential nomination, especially what happened in South Carolina, what's the status of this relationship between the senator and the president?

TODD: Well, it's still not very good. You know, despite whatever they'll say. Many, a few of John McCain's aides, including one, John Weaver who now works with Democrats, was basically shut out of working in Republican politics after this. So the feelings are very bitter. There's still this lingering bitterness that you always detect from the McCain wing of the Republican party.

So, you know, when you look at what happened in the Democratic primary season, Wolf, when basically hate was the stronger feeling than love, when it came to helping John Kerry get to the nomination, hatred of Bush, you know, you could all of a sudden see the enemy of my enemy is my friend and maybe somehow that is how Kerry and McCain marry. It certainly has got a lot of both Republican and Democratic strategists at least, not ruling anything out, he's John McCain, and there's never any comfortable predicting when it comes to John McCain.

BLITZER: Chuck Todd, he's a smart guy in Washington. The editor of the "Hotline." Thank you for joining us.

TODD: Thanks, Wolf.

BLITZER: Here in Florida it's deja vu for voters in one county. Another recount after yesterday's presidential primary. It's an ugly reminder of some of the battles election officials and voters face as November nears.

(BEGIN VIDEOTAPE)

BLITZER (voice-over): Shades of 2000 in Panama City, Florida. Bay county election officials forced to recount thousands of ballots by hand. A malfunction that resulted in a two-to-one primary lead for Democratic presidential candidate Dick Gephardt who pulled out of the race almost two months ago. The problem, apparently a printing error that caused the ballots to scan incorrectly. No harm done, but an alarming reminder of the debacle that threw the last presidential election into chaos. The Bay county system uses optical scanning. But statewide most counties have moved to electronic voting, like this one in south Florida, and there were no significant problems reported in yesterday's primary. UNIDENTIFIED FEMALE: I thought it went smooth. I thought the poll workers knew what they were doing. I liked the new machines, I thought it was really easy, the touch screen.

WOODRUFF: But electronic voting does raise its own set of concerns. Specifically, there's no paper record of the vote. No way to do a manual recount if necessary. Senators Hillary Clinton from New York and Floridian Bob Graham want to make paper records mandatory.

SEN. HILLARY RODHAM CLINTON (D), NEW YORK: This legislation will ensure that voters will be able to verify a paper ballot that accurately reflects their intentions and that will be locked away and will be the official ballot in the event of a recount.

BLITZER: : The maker of one widely used system Diebold says it can be done, but there are concerns about cost as well as securing and storing paper records. It's estimated at least 50 million voters will be casting electronic ballots this November. Another 55 million will still be using paper, punch card, and other machines, making the voting methods almost as closely divided as the voters themselves.

(END VIDEOTAPE)

BLITZER: Let's hope that nightmare scenario doesn't unfold once again in November, especially in this state, Florida, given what happened four years ago.

Much more news coming up, including the controversy over trying Guantanamo detainees by a U.S. military tribunal. It's a debate that can be traced back to World War II. I'll tell you about the connection. That's coming up.

Also ahead...

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I can tell you and your players that you represent, a status quo is not acceptable.

(END VIDEO CLIP)

BLITZER: Suspicions of steroid use in baseball and football. Congress now taking a crack at the problem.

And new hope for Iraq in an unlikely place. Can Iraqi athletes overcome the odds and make it to the Olympic games in Athens this summer?

(COMMERCIAL BREAK)

BLITZER: Gunmen disguised as Iraqi police shot and killed two American coalition officials and their Iraqi translator. The Americans were the first U.S. civilians from the occupational authority to be killed in Iraq. The ambush happened last night about 35 miles south of Baghdad. Six people, most wearing police uniforms, have been detained in connection with the attack.

In Haiti, American marines have killed two more Haitian gunmen. It happened as the marines were expected to begin helping with disarming Haitians with illegal weapons. CNN's Harris Whitbeck is in the capital, Port-au-Prince, he's joining us live via video phone. Harris, tell us what's going on?

HARRIS WHITBECK, CNN CORRESPONDENT: Hello, Wolf, as you say, U.S. marines have been engaged in some fire fights here. The incident that you referred to occurred last night near the residence of the prime minister. Marines were on what they call a presence patrol in the area, when they were engaged. They returned fire and they say that two persons were killed. When they returned to the site with reinforcement, the bodies of those people were not found.

Meanwhile the marines say that they have started with trying to disarm the civilian population. The commander of the marine contingent here in Port-au-Prince told us this afternoon however, that no weapons so far have been confiscated. Security is going to be one of the main priorities of Haiti's new prime minister Gerard Latortue, who arrived in Port-au-Prince just a few minutes ago. He said when he arrived at Port-au-Prince International Airport that security and disarmament will be his top priorities. He also said he will form a commission that will look into reconstituting Haiti's army -- Wolf.

BLITZER: Harris Whitbeck reporting from Port-au-Prince. Harris, thank you very much for that.

A major league face-off as Congress takes a swing at Major League baseball. The warning, stop steroid use or the government steps in.

Some experts say the economy is growing, but where are the jobs? I'll speak with former Clinton labor secretary, now an adviser to Senator Kerry, Robert Reich.

And a new kind of diplomacy. How the sport of cricket could be the key to easing tensions between two nuclear rivals.

(COMMERCIAL BREAK)

BLITZER: A fabulous day here in Miami. I'm Wolf Blitzer reporting live from Miami today. Welcome back.

President Bush defending his economic policy, but what's the opposition saying? I'll ask Robert Reich. He was the former labor secretary during the Clinton administration, now an economic adviser to the Kerry campaign. We'll get to the secretary.

First, though, a quick check of the latest headlines.

Steroids and baseball, a hot topic on Capitol Hill. Members of the Senate Commerce Committee told the head of the Players Union it's time to get tough on players illegally using steroids. Senator John McCain threatened intervention.

(BEGIN VIDEO CLIP) SEN. JOHN MCCAIN (R), ARIZONA: Your failure to commit to addressing this issue straight on in and immediately will motivate this committee to search for legislative remedies. I don't know what they are. But I can tell you and your players that you represent, the status quo is not acceptable.

(END VIDEO CLIP)

BLITZER: No more same-sex weddings in Asbury Park, New Jersey, at least for now. The city council voted to stop after the state attorney general threatened criminal charges against city officials. The city is filing a lawsuit asking the courts to weigh in.

A life sentence handed down for the younger of the two D.C. area snipers; 19-year-old Lee Boyd Malvo was convicted of killing an FBI analyst in October of 2000, one of 13 sniper shootings attributed to him and accomplice, John Allen Muhammad. Yesterday, a different judge sentenced Muhammad to death for another killing.

President Bush today was on the road defending his handling of the economy. It's likely to remain the hottest issue of this election year.

Let's get a fact check now from CNN's Kathleen Hays. She's joining us now live from New York -- Kathleen.

KATHLEEN HAYS, CNN CORRESPONDENT: Hi, Wolf.

When it comes to GDP, there's no doubt the economy has picked up some steam. But for voters there's a four-letter word that matters a lot more. That's J-O-B-S. And, unfortunately, there's not a pickup there yet.

(BEGIN VIDEOTAPE)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Thanks in large part to your hard work, our economy is expanding. Productivity is strong, unemployment has been falling, incomes are rising, and we're going to stay on this path of growth and prosperity in this country.

HAYS (voice-over): And it's not just election-year rhetoric. Wall Street expects the U.S. economy to grow at a 4.5 percent rate this year. That would be the fastest in five years. That's because consumers are shopping, businesses are buying new equipment, and home building and home sales remain red hot, fueled by low mortgage rates.

But even the president's supporters admit there's one big thing missing from the rosy economic picture.

BRUCE BARTLETT, NATIONAL CENTER FOR POLICY ANALYSIS: I think the consensus view is that we'll get 4 percent real GDP growth this year, but the sticking point is jobs.

HAYS: The economy has lost over two million jobs since President Bush took office. And despite White House forecasts saying jobs would be growing by 200,000 or more a month, only 21,000 were created in February. Many voters say that's not enough.

UNIDENTIFIED FEMALE: Everybody I know is out of work, including both of my parents right now. The job market is horrible.

HAYS: Critics say the president's big tax cuts have missed their mark.

UNIDENTIFIED MALE: We've had all these tax cuts, but they seem to have gone to the wrong people, not the people who are spending the money.

HAYS: As the U.S. trade deficit swelled to a new monthly record in January, Mr. Bush's Democratic rival, John Kerry, hammered the White House on the link between free trade and lost jobs.

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: George Bush thinks exporting our jobs is good economic policy. I believe that creating jobs here in America, keeping good jobs here, and exporting goods is good for our economy.

HAYS: Even some of those who may not vote for Bush say when it comes to jobs, some forces are out of president's control.

UNIDENTIFIED MALE: Again, that's not necessarily the fault of the president. This has been happening, outsourcing, you know, from out of this country, outsourcing jobs has been a problem for -- ever since the 1970s.

(END VIDEOTAPE)

HAYS: Economists say that often presidents don't have the biggest influence on GDP and jobs. Maybe they put the blame or the credit with the Federal Reserve for that. But they say, come November, if there isn't more job growth, there's no doubt that President Bush will get the blame -- Wolf.

BLITZER: CNN's Kathleen Hays reporting from New York -- thank you, Kathleen, very much.

We heard earlier this hour from the commerce secretary, Don Evans, who of course, defended the president's economic record.

For the Democrats' view, we turn to Robert Reich. He was a former labor secretary during the Clinton administration. He's now serving as economic adviser to Senator Kerry's campaign. Robert Reich is joining us from Berkeley, California.

Mr. Secretary, thanks very much for joining us.

Yes, the job creation isn't as robust as so many would have liked. But all the economic indicators, in terms of low inflation and economic growth, all of those indicators seem to be moving in the right direction.

ROBERT REICH, FORMER LABOR SECRETARY: Wolf, most of the indicators are moving in the right direction. But the most important indicator, the one that counts for most people, what most people are concerned about is obviously jobs. And we have not seen this degree of job stagnation in a so-called recovery ever before. This is the most anemic jobs recovery on record. And I think that the Bush administration does bear some responsibility.

Bill Clinton, I was proud to be part of the Clinton administration. We created 22 million net new jobs, and what did we do? We brought down the budget deficit and we invested in education and health, and that's what John Kerry wants to do as well. The old policies of this administration are not working.

BLITZER: What do you say to the argument that they make -- and it's a strong argument -- that they inherited what was emerging as a recession, and then, after 9/11, of course, there were enormous expenditures required in dealing with the war on terror and subsequently the war in Iraq? What do you make of that argument that the Bush administration makes?

REICH: Wolf, undoubtedly, there were extraordinary circumstances in this administration over the last few years.

But the major initiative of this administration for dealing with the economy was to give a huge tax break, mostly going to people who are earning over $200,000 a year. That kind of tax break didn't work. It just exacerbated, made the deficit worse. We now have $400, $500 billion deficits as far as the eye can see. This makes the entire economy more fragile. It doesn't help create jobs.

Again, going back to the Clinton administration, we reduced the budget deficit and we invested in education, job training and health care. This is what John Kerry wants to do. The failed policies of this administration are partly responsible for why people are not getting jobs.

BLITZER: You heard the president, you heard Don Evans make the case that John Kerry is now flip-flopping on the whole issue of trade protection, placing up more barriers to try to prevent jobs from being exported, supposedly, that even though he voted for NAFTA, voted for China to join the World Trade Organization, has always been a free trader, he's now flipping and he's going in the opposition direction.

You're a free trade advocate. Is this a dangerous trend we're seeing on the part of Democrats?

REICH: I don't John Kerry is any way a protectionist, Wolf.

I think he's saying -- in fact, I know that he's saying that we've got to have around the world labor standards and environmental standards, so that it's not a race to the bottom, so that, in fact, countries, as they can afford to give their workers better working conditions, better pay and also improve the environment, as countries can afford to do so because they get wealthier through trade, those standards should rise. That's good for those countries. It's good for building a middle class around the world. It's also good for us. BLITZER: The whole issue of outsourcing, is this going to be a major issue in the campaign, the fact that so many American companies are going abroad to get cheaper labor, not only in the old manufacturing work, but in the information, the so-called superhighway, the kind of jobs that were supposedly going to be secure here in the United States?

It's cheaper to do it in India or even China. Is this going to be a big issue during this campaign?

REICH: Wolf, it already is a large issue.

There has been a loss in the economy so far of 2.5 million manufacturing jobs, and increasingly large numbers of goods service jobs. If the administration simply took away the tax advantages to companies from moving abroad and pushing the jobs abroad, that would be a big advantage. That would be a big step forward. John Kerry calls for basically eliminating the tax advantages for going abroad and outsourcing.

That's a very sensible policy. It doesn't destroy World Trade and it does keep jobs at home.

BLITZER: Robert Reich, the former labor secretary, now an adviser on economic issues to Senator Kerry, thanks very much, Mr. Secretary, for joining us.

REICH: Thank you, Wolf. Bye-bye.

BLITZER: Thank you.

It's caused a stir around the world and right here at home. Now a new book shows a link between detainees in Guantanamo Bay in Cuba and events that occurred during World War II. We'll explain when we speak live with the author.

And against all odds. With the fall of Saddam Hussein's regime, they're free to dream big again. That is Iraqi athletes. They now have their eyes on Athens and Olympic gold this summer. We'll get to that.

First, though, a quick look at some other news making headlines around the world.

(BEGIN VIDEOTAPE)

BLITZER (voice-over): Turkish investigators say yesterday's bomb attack on a Masonic lodge in Istanbul appears to have been the work of local Islamic militants, but not the work of al Qaeda. A waiter was killed, along with one of the two suspected attackers.

Inspection agreement. Libya has signed an agreement allowing U.N. experts to conduct snap inspections of nuclear facilities. The visits are designed to make sure Libya is living up to its recent agreement to abandon its nuclear weapons program. Make runs, not war. An Indian cricket team met with India's prime minister, then flew to Pakistan for its first full tour of that country in almost 15 years. It's hoped the tour will further ease tensions between the two nuclear rivals, which almost went to war two years ago.

Paper rhino. They do have real animals at this Tokyo zoo, but this rhinoceros is an obvious fake, a papier-mache rhino used for an annual drill. The zoo workers beneath this make-believe beast are trying to simulate the movements of a real rhino, so colleagues can practice their responses to a real-life animal rampage.

And that's our look around the world.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

BLITZER: We're reporting from Miami today. Thanks very much for joining us.

The controversy over the terrorism suspects held at U.S. Naval Base at Guantanamo Bay in Cuba has a fascinating link to an event in World War II, the capture and military trial of eight German saboteurs in the United States in the summer of 1942. It's the topic of an important new book by "Washington Post" correspondent Michael Dobbs. It's entitled "Saboteurs: The Nazi Raid on America."

Michael Dobbs joining us now live from Washington.

Michael, explain to our viewers the relevance, why what happened to those Nazi saboteurs during World War II under the Roosevelt administration is relevant to what's happening with the hundreds of detainees at Guantanamo Bay right now.

MICHAEL DOBBS, AUTHOR, "SABOTEURS": Well, these saboteurs were transported across the Atlantic by U-boat.

They intended to blow up aluminum factories in the United States. They were arrested within two weeks of their landings in Amagansett, Long Island, and Ponte Vedram, Florida. And President Roosevelt was faced with the challenge of what to do with them. He didn't want to turn them over to the civilian courts, because he feared that the civilian courts would let them go with very mild sentences.

So he wanted to send a message to Hitler not to send any more saboteurs to American shores, wanted to make an example of them. And he thought the only way that he could do that was by sending them to military tribunals and have the military tribunals pass death sentences.

(CROSSTALK)

BLITZER: And let me interrupt you. You write in the book -- and I'll put it up on the screen. You write: "A military trial was likely to be much swifter than a civilian trial and would sidestep the cumbersome rules of evidence demanded by civilian courts."

Now flash-forward to what's happening right now. The legal precedent used then is being used by the Bush administration right now. How strong of a case do they make?

DOBBS: That's right. The Bush administration has pretty much copied the rules of procedure dictated by President Roosevelt for these military tribunals back in 1942. And they're going to use the same rules of procedure to try the Guantanamo Bay suspects.

They're not as rigid, not as many guarantees as there would be for defendants in civilian courts. And it also enables the prosecution to seek tougher sentences than they would probably get in the civilian courts. So the rules of procedure favor the prosecution.

BLITZER: Is there any indication, based on the research that you've done, that the U.S. Supreme Court, which eventually is going to make a decision on all of this, is going to come out differently this time than it came out during World War II?

DOBBS: I think they'll probably reach pretty much the same conclusion. The Supreme Court -- today's Supreme Court has agreed to hear appeals from the lawyers for the Guantanamo Bay detainees.

Those hearings will be held in April sometime. And, by doing so, they're asserting their right to review the decisions of the Bush administration. This is precisely what happened in the Second World War. But having done that, having asserted the fact they have a role to play, I think they'll do the same as their predecessors did in World War II, uphold the administration's decision, right to try these people by military tribunals. So it will be a kind of shot across the bows of the administration, but they won't overturn the administration's decisions.

BLITZER: A fascinating account from World War II, "Saboteurs" the name of the book. Michael Dobbs, the award-winning reporter for "The Washington Post," joining us.

Michael, thank you very much.

DOBBS: Thank you.

BLITZER: They're carrying Iraq's hopes on their shoulders. With little resources and lots of enthusiasm, Iraqi athletes right now aiming for Athens, the Olympic Games, this summer.

And Saddam Hussein in rare form, one man's invention now a hot seller in a Turkish town.

(COMMERCIAL BREAK)

BLITZER: Welcome back to our continuing coverage. We're live in Miami today.

We'll move on and talk about a story now, a story of optimism. They lack the resources other Olympic athletes certainly enjoy, but that's not stopping a group of aspiring Iraqi athletes from dreaming of gold. With just months until the game begin in Athens, they have little time, but lots of hope.

CNN's Ben Wedeman reports.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN CORRESPONDENT (voice-over): It's not easy to carry your country's hopes on your shoulders. In this gym, the weight lifters say, if anyone can win a gold medal for Iraq, it will be 23- year-old Mohammad Abdel Manin (ph). He's already qualified to represent Iraq at Summer Olympics in Athens. But these weight lifters are straining against the odds.

"We don't have any training camps," says Mohammad. "We don't have any equipment. We need lots of things."

WEDEMAN: Like those high-protein supplements that weight lifters in most countries take for granted. Saddam's regime treated these athletes like lightweights.

"In the old era, the best athlete got $4 a month, recalls head coach Mohammed Jelut (ph). "Now they get $300 from the Iraqi Olympic Committee, and their gym is being refurbished with money from the coalition."

(on camera): Under the old regime, the Olympics had a dark significance for many Iraqis. Uday, Saddam's pathological sons, ran the Iraqi Olympic Committee out of this building. During the war, it was bombed, afterwards, looted, then burned.

(voice-over): Torture chambers in the basement awaited athletes who displeased Uday. Allegations of abuse led the International Olympic Committee to suspend Iraq's membership two years ago. It was reinstated last month.

Unus Macmud (ph) is the Olympic soccer team's star player.

"The Olympics are something every young athlete dreams about," he says, but he has more down-to-earth concerns. He comes to practice by taxi because he's afraid his car will be stolen. The upheaval of the last year has made it difficult to focus on training.

"The infrastructure services have been severely damaged," says coach Adnan Hamed (ph). And that affects the players like it does everyone."

The games in Athens are less than five months away and will be an opportunity for a new generation of Iraqi athletes to have a shot at glory.

Ben Wedeman, CNN, Baghdad.

(END VIDEOTAPE)

BLITZER: Good report from Baghdad. He's been call many things, but seldom a doll. Saddam Hussein like you've never seen him before.

(COMMERCIAL BREAK)

BLITZER: We've been enjoying the day here in Miami today.

The dancing Saddam doll, it's our picture of the day. It's a hot seller in one Turkish town. Some buyers appreciate the novelty, while others say they're using the doll to teach their children about the recent war in Iraq. The manufacturer is also putting out dancing dolls of Osama bin Laden and President Bush. If I'm President Bush, I don't like that company.

A reminder, you can catch us daily weekdays at 5:00 p.m. Eastern on WOLF BLITZER REPORTS. I'm also here noon Eastern. We'll be back in Washington tomorrow.

"LOU DOBBS TONIGHT" starts right now.

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



Dream of Olympic Glory>


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