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Lou Dobbs Tonight
Terrorist Plot Targeted Ohio Shopping Mall; Baghdad Suicide Bomber Kills American, 4 Westerners
Aired June 14, 2004 - 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.
LOU DOBBS, CNN ANCHOR: Tonight, the government stops a radical Islamist plot to kill thousands of Americans in a shopping mall in Ohio.
(BEGIN VIDEO CLIP)
JOHN ASHCROFT, ATTORNEY GENERAL: The American heartland was targeted for death and destruction by an Al Qaeda cell.
(END VIDEO CLIP)
DOBBS: Terror in Baghdad. A suicide bomber kills an American, four other Westerners helping to rebuild Iraq.
The State Department admits it made a big mistake when it said global terrorism declined last year. Congressman Henry Waxman says that's not good enough. He's furious. He's our guest tonight.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: One nation under God...
UNIDENTIFIED MALE: One nation under God...
(END VIDEO CLIP)
DOBBS: And a dramatic victory at the Supreme Court for supporters of the words "under God" in the Pledge of Allegiance.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: We are pleased that we can continue reciting the pledge each and every day in our schools.
(END VIDEO CLIP)
DOBBS: And more controversy over Bermuda-based Accenture's massive Homeland Security contract. Illinois State Comptroller Dan Hines is our guest.
ANNOUNCER: This is LOU DOBBS TONIGHT for Monday, June 14. Here now for an hour of news, debate and opinion is Lou Dobbs.
DOBBS: Good evening.
Tonight, Al Qaeda plotted to kill hundreds, possibly thousands of Americans in a shopping mall in Ohio.
The government today charged a Somali citizen with conspiring to help Al Qaeda blow up a mall in the Columbus area. Attorney General John Ashcroft today repeated its warning that al Qaeda wants to launch a major attack in this country.
Justice Correspondent Kelli Arena reports -- Kelli.
KELLI ARENA, CNN JUSTICE CORRESPONDENT: Lou, his name is Nuradin Abdi, and he's charged with providing material support to Al Qaeda. The government says that he plotted to blow up a shopping mall with convicted al Qaeda operative Iyman Faris.
(BEGIN VIDEO CLIP)
ASHCROFT: Upon returning to the Columbus, Ohio, area, it is alleged that Abdi along with admitted Al Qaeda operative Faris and other co-conspirators initiated a plot to blow up a Columbus area shopping mall. It is also alleged that in pursuit of this plot, Abdi received bomb-making instructions from one of those co-conspirators.
(END VIDEO CLIP)
ARENA: The FBI in Ohio says there is no information on which specific mall was being targeted, and agents there say the mall threat was just one of several associated with Abdi, but they would not go any further. Sources say Customs and FBI agents there had been surveilling him for a while before he was taken into immigration custody in November.
(BEGIN VIDEO CLIP)
KEVIN BROCK, FBI: There were a lot of reasons why we detained him during that time. A lot of things came into play. I can't get more specific than that. But we looked at every angle of this case as we made those judgments.
(END VIDEO CLIP)
ARENA: Abdi made an initial appearance in court today. He was not accompanied by a lawyer, and he did not enter a plea. Now two of his brothers spoke to the press outside the courtroom, and they insist their brother is innocent and not a terrorist -- Lou.
DOBBS: Kelli Arena.
Thank you.
In Baghdad today, a suicide car bomb targeted Western civilians trying to help rebuild Iraq. The explosion killed an American and four other Western contractors. At least eight Iraqis were also killed in the blast. It was the second car bomb attack in Baghdad in two days.
Guy Raz reports.
(BEGIN VIDEOTAPE)
GUY RAZ, CNN CORRESPONDENT (voice-over): Baghdad's landscape now characterized by chaos. A morning rush hour suicide car bombing this time, another explosion to join the cynical chorus of blasts here, the 17th car bomb in Iraq this month.
Westerners were targeted; Iraqis part of a terrorist's collateral damage. Among the dead, three foreign workers employed by General Electric. They were in Iraq to help restore the country's dilapidated electricity grid.
Near the site of the blast, charred bodies were pulled from the rubble of this three-story building. Burning vehicles smoldered in the middle of the road. Condemnations from all corners.
Still, those behind the attacks seem more determined than ever.
IYAD ALLAWI, INTERIM IRAQI PRIME MINISTER: We deplore this terrorist act and vow to get the criminals to justice.
RAZ: An angry crowd gathered around the bomb site. "America is the enemy of God," they chanted. Confused Iraqis passed along conspiracy theories blaming America, Jews and others, anyone except Iraqis.
(on camera): Less than a month before administrative authority is handed over to an Iraqi government, officials warn of more attacks to come. Most of them silently concede they'll be impossible to stop.
Guy Raz, CNN, Baghdad.
(END VIDEOTAPE)
DOBBS: Western contractors in Saudi Arabia are also being targeted by radical Islamist terrorists. Saudi police and troops are hunting Al Qaeda gunmen who kidnapped an American engineer who worked for Lockheed Martin. But tens of thousands of Americans remain in Saudi Arabia at least for now, despite warnings about the possibility of more attacks on Westerners and, in particular, Americans.
Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN BUSINESS CORRESPONDENT (voice-over): Lockheed put out this statement today about missing employee Paul Johnson: "Be assured the full attention and resources of this corporation are committed to support efforts to secure Paul's safe return."
Paul Johnson's son spoke outside his home in Florida.
PAUL JOHNSON II, SON OF MISSING AMERICAN: My father's company, Lockheed Martin -- they've been great. They've been keeping me informed.
PILGRIM: The U.S. Embassy has been informing Americans in Saudi Arabia for weeks, issuing a travel warning as far back as April 15, and yesterday outlining precautions to help Americans avoid attack. There are an estimated 35,000 Americans and 30,000 Britons working in Saudi Arabia. The Saudi government provides basic security, but additional precautions may be needed.
IAN BREMMER, EURASIA GROUP: The amount of security you're going to have to pay for is going to be very inconvenient. It's going to be prohibitively expensive. With the exception of direct oil-related investments, it's extremely difficult to find margins like that that will support that kind of work.
PILGRIM: The difference between previous rounds of attacks, such as the housing compound attack in 2003, is now individual victims appear to be targeted.
ROBERT JORDAN, FORMER U.S. AMBASSADOR TO SAUDI ARABIA: This is a new tactic by the terrorists, and I think we now are finding that there are a lot more of these terrorists inside Saudi Arabia than we believed even a year ago.
PILGRIM: For many, the lifestyle inside gated communities and the pay scale has been worth the risk.
DAVID ISBY, DEFENSE AND FOREIGN POLICY ANALYST: I think Saudi Arabia is that important to the West and the links are so deep that terrorists will not cause people to cut and run.
PILGRIM: So far, experts say there has been no mass exodus, although there are no official figures on how many have left.
(END VIDEOTAPE)
PILGRIM: The State Department warning says private American citizens in Saudi Arabia are strongly urged to leave and U.S. citizens should put off traveling there. However, U.S. Secretary of State Colin Powell said yesterday in an interview the United States would do everything it could to help Saudi Arabia retain its foreign workforce -- Lou.
DOBBS: So the State Department is warning Americans to get out of Saudi Arabia while the secretary of state is telling Americans to remain?
PILGRIM: In fact, giving verbal support to keeping the workforce intact, and the State Department today reiterated that warning, that Americans should take that warning seriously. So it's very much a mixed message.
DOBBS: And, at the same time, the companies are not providing security for their employees, the American companies, because the Saudis won't permit them.
PILGRIM: The Saudis like to provide their own security. They prefer that system, which seems not to be working all that well.
DOBBS: Kitty Pilgrim. Thank you.
The United States and the United Nations today told Iran to come clean about its nuclear program. The White House says Iran is trying to develop nuclear weapons. White House Spokesman Scott McClellan called upon Iran to abide by its international agreements.
The head of the International Atomic Energy Agency, Mohamed ElBaradei, said Iran's cooperation with inspectors has been "less than satisfactory." ElBaradei said Iran must provide assurances about its nuclear program within months. Baradei did not say what would happen if Iran fails to comply.
Still ahead here tonight, outrage over the State Department's faulty report claiming the number of terrorist attacks declined last year. Democratic Congressman Henry Waxman is furious about the mistake and the time that it took the State Department to respond to his inquiries. He's our guest next.
And the Supreme Court today sidestepped the controversy over the Pledge of Allegiance in public schools and the words within it, "under God." Tonight, we talk with two experts on the law who have very different views on the issue.
And exporting America. A multibillion-dollar national security contract for Bermuda-based Accenture just one controversy involving the company. A top official in Illinois wants his state to avoid all business with Accenture. He's our guest, still ahead.
(COMMERCIAL BREAK)
DOBBS: Secretary of State Colin Powell is promising a full investigation of an incorrect State Department report on global terrorism. The report incorrectly stated that the number of terrorist attacks fell last year when, in fact, the number of such attacks rose.
My guest tonight was among the very first in Congress to challenge the initial findings of this report. Democratic Congressman Henry Waxman has called on Secretary Powell to give a full explanation as to how such a mistake could occur. Congressman Waxman joins me tonight from Washington, D.C.
Congressman, good to have you here.
REP. HENRY WAXMAN (D), CALIFORNIA: Thank you. Good to be with you.
DOBBS: You became suspicious of this report almost as soon as it was out. Why?
WAXMAN: I became suspicious of it because the numbers didn't seem right. Suddenly, we saw terrorism going down in 2003 because, for some reason or another, they decided to combine significant terrorist attacks with nonsignificant terrorist attacks, whatever they are, and, as a result of combining the two, they said terrorism was at a 34-year low, and that couldn't be in a year when we had bombings in Turkey, Saudi Arabia and Iraq, and in Israel, all around the world. It didn't seem like a quiet time for terrorism.
This report that the State Department put out is supposed to be the authoritative report on terrorism. It's supposed to be of use for government agencies in the United States and for other countries around the world to know what trends there are in terrorism.
When they put out this report, the State Department immediately jumped on it and said look what a great job we're doing. Terrorism is going down. It turns out, however, when you really look at it, terrorism went up, and it's the highest in 20 years.
DOBBS: Congressman Waxman, I want to quote, if I may, from your letter to Secretary of State Powell because it contains, I think, a wonderful sentence, and it says, "After your analysis, this leads to the bizarre conclusion that each significant terror attack is detailed in a public report, but information," which you requested, "regarding the so-called nonsignificant attacks is withheld from Congress." Any explanation to date as to how that could be?
WAXMAN: I really don't understand it. We wrote to Secretary Powell on May 17. I got a call from him last Thursday, June 10, a day after the story broke in the "L.A. Times." He insisted when he talked to me that the numbers were not being cooked for political purposes. It was incompetence, it was a mistake, and he's going to redo through the report.
I asked him if he'd answer our letter because one of the things I wanted to know is what are these nonsignificant terrorist attacks, was this done by professional people, or was it done by political people. I told him he could see why I might be suspicious that it was politically motivated because they immediately took credit for the reduction in terrorism and the president is running on his record in the war against terrorism.
But I take him at his word. It's just give him the benefit of the doubt, incompetence, and that doesn't speak well for our efforts to really know what's happening about terrorism.
DOBBS: I find the word "incompetence" to be chilling. Equally so, I would find the expression "politically motivated" chilling. In either case, it's not a happy result. Did the secretary of state offer anything beyond that rather cursory explanation?
WAXMAN: Well, he said that he was going to find out what happened, get to the bottom of it. He was disturbed himself at the result of a report that was so far off the mark.
The report was really worthless. No one could use it for any real legitimate purpose. It was requested so that it could give information that would help us in fighting terrorism, and the result of this report is just to have a document that's so way off the mark of what really happened that it's of no value, except for somebody who wants to claim they're doing a good job in this administration lowering terrorism rates, but, when you look at the reality, terrorism in 2003 was at a 20-year high. DOBBS: Congressman, you're also questioning Vice President Dick Cheney about whether he knew about the Halliburton contract to repair Iraqi oil fields before it was granted. What makes you, obviously, suspect that he did?
WAXMAN: He has insisted for months now that he and his office had nothing to do with the award of the sole source contract to Halliburton, and people in the administration have also insisted that this was done by the career people in the Army and not by political people.
Well, we now have information from a briefing our staff received last week that, in fact the whole thing was brought to a meeting of the political appointees, including Scooter Libby, who is Vice President Cheney's chief of staff, and the reason it was brought to them is that they wanted to be sure that they didn't have any objection that they were going to go to Halliburton, even though there are other companies that could do the job. So...
DOBBS: So you're basing that...
WAXMAN: ... I've written to Vice President Cheney and asked him for a full explanation.
DOBBS: OK. A spokesman for the vice president says that your allegations, if you will, are politically motivated. How do you respond?
WAXMAN: Well, I've made no allegations. I'm simply reporting what the fellow that works for the Defense Department has told us in a meeting, that he brought this to Mr. Cheney's chief of staff, he brought it to the political people, and the decision was not made by the career people, but by the political people.
So I've asked Vice President Cheney, without making any accusations about him, because we don't really know the truth at this point, we don't know the full story. But we do know that what he's been saying is inconsistent with the facts as we've now learned them.
DOBBS: Congressman Waxman, only in Washington could that be considered not an allegation, to suggest the facts are not in accordance with the statement.
WAXMAN: Well...
DOBBS: A lot...
(CROSSTALK)
WAXMAN: ... to learn more about it.
DOBBS: In other parts of the country, that could be called an outright lie. But we appreciate, Congressman Waxman, you being here. We appreciate it.
WAXMAN: Thank you. DOBBS: Still ahead, "under God" preserved for now. We'll talk to two legal experts about today's Supreme Court ruling.
Also, a new form of bank robbery, and it's online. Literally millions of accounts have had money stolen, and some of those holders of those accounts don't even know about it yet. We'll have a special report to bring you up to date.
And blown away in the Midwest. A string of devastating tornadoes struck the region over the weekend.
We'll have that and a great deal more, still ahead. Stay with us.
(COMMERCIAL BREAK)
ANNOUNCER: LOU DOBBS TONIGHT continues. Sitting in for Lou Dobbs, Kitty Pilgrim.
DOBBS: Sitting in for Lou Dobbs is Lou Dobbs this evening.
The Supreme Court today ruled against a challenge to the Pledge of Allegiance in public schools. The ruling means children will continue to say the pledge in school.
Michael Newdow, an atheist, claimed his daughter's First Amendment rights were violated when her classmates recited the pledge. But Newdow does not have custody of his daughter, and, technically, that caused the Supreme Court to rule against him, suggesting he did not have any standing.
In today's ruling, Justice John Paul Stevens wrote, "When hard questions of domestic relations are sure to affect the outcome, a prudent course is for the federal court to stay its hand rather than reach out to resolve a weighty question of federal constitutional law."
Joining me now to discuss the ruling, in Washington, Barry Lynn, who's executive director of Americans United for Separation of Church and State, and Jay Sekulow, who is chief counsel for the American Center for Law and Justice, joining us tonight from Virginia.
Thank you both for being here.
JAY SEKULOW, AMERICAN CENTER FOR LAW AND JUSTICE: Thanks, Lou.
BARRY LYNN, AMERICANS UNITED FOR SEPARATION OF CHURCH AND STATE: Thank you.
DOBBS: This is -- well, I'll wait for you to characterize it -- but a surprising ending to this issue based on a technicality.
Barry, your thoughts?
LYNN: Yes, I'm really disappointed that they punted on this one, that they didn't get to the weighty constitutional issue that Justice Stevens talked about.
The question here has always been: Should children in a public school be required or effectively feel pressured to participate in what amounts to a religious loyalty oath, to say not just I affirm that I love my country, but, also, that I believe in one God?
We have a tremendous multitude of religions, over 2,000 in this country, 10 million to 20 million nonbelievers. I think they should all be able to be first-class patriots, affirm love of country, without getting into the religious angle.
And, in fact, in 1892, Lou, when this was written...
DOBBS: Jay...
LYNN: ... by a minister, that minister didn't put any religious language in the Pledge of Allegiance.
DOBBS: Jay...
SEKULOW: Of course, the Supreme Court didn't write that opinion today. What they said was something that all of us that were involved in the case advocated, that the first issue in the case was: Should Michael Newdow have been able to bring this in federal court in the first place? And the court was pretty clear in that, saying absolutely not, which was the first issue they had had to address.
With regard to the merits of the case, Barry's right in part in that the court did not decide the case on its merits, at least the merits as to the "under God" phrase.
But there is an important vote here and one that both Barry and I look at regularly, and that is where does Justice O'Connor come out on this because, Lou, oftentimes, it's Justice O'Connor's vote on these cases that is the pivotal vote, called the swing vote. Many of these cases are 5-4 splits.
She said today that she would have reached the merits of the case and decided that the Pledge of Allegiance was, in fact, constitutional with the phrase "under God" in place, and I think that does...
LYNN: Well, you know, Jay...
SEKULOW: ... send a message there, at least as far as her vote's concerned.
LYNN: Well, here's what I think the message is, Lou, and I think the message is since five people did not express an opinion, I would not be surprised if over the next few weeks or months, another parent, this time a parent that does have custody of his or her child, will file the same suit, probably in California, hoping that it follows the same trajectory. That is, an affirmation by...
DOBBS: Does it...
LYNN: ... the Ninth Circuit that the pledge is unconstitutional with "under God," and we'll get this case back to the Supreme Court in a couple of years.
DOBBS: Well, affirmations by the Ninth Circuit Court have -- it's the most overturned appellate court in the country.
SEKULOW: And here, it was today again.
DOBBS: More interesting, at least to me, Jay, is the question -- excuse me, Barry, as Jay just pointed out, Sandra Day O'Connor, Justice O'Connor tipping her hand, if you will. That must concern you.
LYNN: Well, it does. It concerns me. But it also means that Justice Kennedy, who also could have participated and decided this case on the merits, decided not to state an opinion, and I think that this is going to mean that people will be lining up to file further lawsuits on this very question because it is terribly important, and I think Jay concurs, at least in this much, that when you're talking about minority religions that are growing in this country, nonbelievers...
SEKULOW: Yes, but she put the -- Justice O'Connor...
LYNN: ... that they have rights, too.
SEKULOW: ... had it right, Barry, when she put the pledge in its historical context, why the phrase was in there. It was an acknowledgment that our founding generation believed that the liberties and freedoms that we enjoy as Americans are not a gift from government, that they're a gift from God. The role of government is to protect those. That's what she said in her opinion.
LYNN: Jay, wait a minute. Our founders didn't write the pledge. Our founders, by the way, weren't even around in 1954 when this was amended under pressure from the so-called religious right of its day to make sure that America said we're religious; Russians, you're not.
DOBBS: Let me ask you both. These were sort of magical words from the U.S. Supreme Court, it seemed to me, suggesting that it is a prudent course for the federal court to stay its hand. Those are words we don't often hear from this court.
Is there a possibility that the court would stay its hand in future cases, irrespective of the technicalities, because there becomes an issue, it seems to me -- and I'd love because you're two of the most thoughtful people on this issue in the country.
It seems there comes a question of proportionality, of all that a child must hear, of all that a child must endure in our public school system, with all of the problems, the discipline problems and so forth in our educational system, it seems the words "under God" perhaps could be amongst the least offensive words that are polluting the air around them.
Is there any suggestion that perhaps those are rather mild words compared to others and there is an issue of proportionality here, Jay? SEKULOW: Justice Ginsburg -- interesting, Lou, and it's a great question. Justice Ginsburg brought that up during oral argument. She said, you know, the phrase "under God" -- she said, well, after all, we start off this proceeding "with God save the United States and this honorable court."
She called this statement something that's part of the American experience, and she almost said the same phrase you're using, that this really doesn't raise to the level of a constitutional crisis, and I think that is probably where a majority of the court would go on this.
We don't know that because we don't have an opinion, but I think you're absolutely correct. I think that's how the court was looking at it.
LYNN: You know, we don't always need a constitutional crisis in order to resolve an important constitutional issue. I do think, Lou, though that one possibility here is that the court, which also watches television and reads the newspapers, may have decided that this was not the time to decide this, to throw gasoline right on the cultural war fire that's going on, particularly in an election year.
But I think they can't duck it forever and I think there are enough people, religious and nonreligious, who will want to bring another case, that this can't be avoided in the long run.
DOBBS: Barry Lynn, Jay Sekulow, we thank you very much.
LYNN: Thanks, Lou.
SEKULOW: Thank you.
DOBBS: Gentlemen, appreciate your being here.
That brings us to the subject of our poll tonight, and the question an obvious follow to the discussion you just heard. Should the phrase "under God" be eliminated from the Pledge of Allegiance? Yes or no or a minor issue. Cast your vote at cnn.com/lou. We'll have the results for you later in the broadcast.
Tonight's thought is on celebration of Flag Day. Yes, today is Flag Day.
"A thoughtful mind, when it sees the nation's flag, sees not the flag only, but the nation itself; and whatever may be its symbols, its insignia, he reads chiefly in the flag, the government, the principles, the truths, the history which belongs to the nation that sets it forth."
That from American clergyman and writer Henry Ward Beecher.
The United States trade deficit exploded to another staggering record last month. The Commerce Department reports the trade deficit widened to more than $48 billion. The report also confirmed two alarming trends. This country has lost its edge in technology exports and rapidly is losing its edge in the services sector as well.
Peter Viles reports.
(BEGIN VIDEOTAPE)
PETER VILES, CNN CORRESPONDENT (voice-over): The American economy continues to set records, but these are records no one could be proud of, a record trade deficit, $48.3 billion in April. That is five record trade deficits in a row, and oil was not the problem. Oil imports fell. But so did U.S. exports, dropping $1.5 billion from March, all of which means more borrowing to pay for all those foreign goods.
CHARLES MCMILLION, MBG INFORMATION SERVICES: We are now borrowing about a million dollars a minute just to pay for all these imported cell phones and computers and cars and other things, and that has accumulated to over $3 trillion dollars just in the last dozen years.
UNIDENTIFIED FEMALE: Would you like your receipt in the bag, ma'am?
VILES: The United States runs a surplus in services, but that is shrinking from $64 billion in 2001 to just $51 billion last year, and some economists believe the government is missing the boom in outsourcing to India.
ROBERT SCOTT, ECONOMIC POLICY INSTITUTE: Official data suggests that we import only about $300 million a year in services, imports from India, and yet the Indian statistics suggest that they're exporting several billion a year to the United States.
VILES: Conventional wisdom says the overall trade deficit reflects products such as sneakers, electronics, and toys. Products the American economy doesn't really make, but that is not the case. Autos and auto parts are a bulwark of U.S. manufacturing, but the deficit there is widening. And the U.S. trade advantage in technology is gone. We ran a $3 billion deficit in April in what the government calls advanced technology products.
(END VIDEOTAPE)
VILES: And then there is the China syndrome. The trade deficit with China, just under $12 billion in April. It is running 24 percent of last year's pace. Last year was a record 124 billion, running well ahead of that, Lou.
DOBBS: U.S. exports declining, the deficit widening, no advantage in technology, services declining as well. Yet corporate America and this administration and most private economists continue to say, don't worry about the jobs being lost. We'll make it up in technology and high-value jobs.
VILES: It's like the company that loses money and says it will make it up in volume. The trend is worsening.
DOBBS: Peter Viles, thank you, sir.
Taking a look now at some "Your Thoughts" on the subject of "Exporting America."
Jim Rice of Red Bank, Tennessee, "The trade gap has now reached record levels and no one in this administration seems to care. We are the greatest market in the world. Can't we use that for leverage to level the playing field for our workers?"
Matthew Harper of Vienna, West Virginia, "I understand your concerns with the outsourcing of jobs. But I think you are ignoring a major fact in this issue. It is true that many jobs are leaving the United States, but by far more jobs are coming in.
Well, unfortunately, that is absolutely not true. It is the reverse, I'm sorry to inform you.
Leslie Sora, Delmont, Pennsylvania, "Not only are American companies sending jobs overseas, but the returning product is of substandard quality as well. I've lost count on the returns I've made for towels that shred after two washes, clothing with crooked seams, buttons sewn on with two threads, misshapen glassware, bed sheets that barely fit the mattress, the list goes on. Americans must begin to return this junk even if it's only 50 cents."
Maybe they will get the message, but I doubt it.
We thank you for "Your Thoughts." Send them to us at loudobbs@cnn.com. We'll share more of "Your Thoughts" later here in the broadcast tonight.
A disturbing new report tonight on identity theft. Gartner Consulting reporting that nearly two million Americans were the victims of online theft last year. Thieves stole more than $2 billion from the checking accounts of those people across the country. And they did it all, of course, electronically.
Lisa Sylvester, reports from Washington.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Thieves have found a new way to tap into consumers' bank accounts. They don't even have to steal personal information, they just ask for it. It's called phishing. Criminals send out phony e-mails requesting bank information updates with a link to a fake Web site. It is almost impossible to tell the difference between this phony Fleet Bank Web site and the real one.
AVILA LITAN, GARTNER CONSULTING: Even though it may say in your e-mail a legitimate Web site, hidden behind that address is the crook's address.
SYLVESTER: For identity theft victims, clearing their names can take years. Sharon Jones has a pile of letters from creditors demanding payment for bills that are not hers. SHARON JONES, IDENTITY THEFT VICTIM: It's been a total nightmare because you never know when something else is going to pop up, so you have to constantly check your credit report.
SYLVESTER: Phishing e-mails have increased 4,000 percent in the past six months according to the Anti-Phishing Working Group, which includes Internet providers, banks and law enforcement officials. Citibank, eBay and PayPal are the most common targets. But consumers can protect themselves by looking for tip-offs such as misspelled words and by not clicking on links, even that look legitimate.
DAVID JEVANS, ANTI-PHISHING WORKING GROUP: The most effective thing is to really open up a Web browser window and go directly to the bank, yourself. Type in the address, into the Web browser, rather than relying on the link.
SYLVESTER: The financial and computer industries are working on standards to authenticate e-mail. In the meantime, banks will reimburse victims of credit and checking account scams provided they're reported within two months.
(END VIDEOTAPE)
SYLVESTER: There's another growing trend in identity theft called Trojan horse or spyware. Consumers are sent a link, and when they open it, they have unknowingly downloaded spyware software, that records every keystroke, including personal financial information -- Lou.
DOBBS: That is troubling, to say the least. Lisa, thank you very much. Lisa Sylvester reporting tonight from Washington.
Residents in parts of Southern Kansas tonight are cleaning up after powerful tornadoes hit over the weekend. The most powerful of six tornadoes destroyed one house in Mulvane. Fortunately, no one was home when the storm hit. These are incredible images. The governor of Kansas has declared a state of disaster for 12 counties.
Storms in Texas have dumped heavy rains in the southeastern part of the state. Roads and highways remain flooded tonight. Officials said about 13,000 homes and businesses lost power at the height of the storm.
New Mexico could use a little of that rain to help battle a wildfire that has now burned about 2,500 acres in the western part of the state. Officials say the fire was sparked by a camp fire.
Still to come, fighting the exporting of American government jobs to foreign companies.
Illinois state comptroller, Dan Hynes, says it is unpatriotic, and he's leading the effort in his state to stop it. He is our guest.
And putting Americans back to work. Senator Kerry says he has a plan. Senator Kerry's, economic adviser, Gene Sperling is our guest.
(COMMERCIAL BREAK)
DOBBS: It's been nearly two weeks since the federal government awarded a border security contract, worth possibly as much as $10 billion to a foreign based company.
The Department of Homeland Security chose Accenture over two American based companies to create an integrated system that would track U.S. visitors and immigrants.
My next guest says companies like Accenture are what he calls expatriate corporations and he wants to make sure they don't receive contracts from the state of Illinois. He says it's an issue of fairness and in some ways patriotism.
Joining me now, Illinois State Comptroller Dan Hynes. Good to have you with us.
DAN HYNES, ILLINOIS STATE COMPTROLLER: Thank you. Good to be here.
DOBBS: You have taken this battle on in a state. You were actually in contest with your governor, in point of fact, over the awarding of contracts to foreign-based companies.
What is the status of your -- your fight to avoid that?
HYNES: Well, we tried to pass legislation in Illinois to stop companies who move offshore from getting state contracts. Unfortunately, my legislation stalled in the Illinois legislature. Meanwhile, one of those companies, Accenture, got an $11 million bid or contract to do computer services for the state. So we have blocked $2 million in contracts because we don't believe we should be giving tax dollars to companies who move offshore to avoid paying taxes. It is an issue of patriotism. I do think it's unfair because all of us pick up the slack. We have to pay higher taxes because these companies want to build their bottom line by avoiding their taxes.
DOBBS: You've also refused to pay $2 million that everyone, apparently, agrees is owed Accenture for work it's done in the past and withholding that. I'll tell you frankly, it seems to me a little unfair.
If they've done the work, why not write them the check?
HYNES: Well, we're going to find out whether, in fact, we have to pay them for work performed. But there's still $9 million pending of contractual obligation that have not been earned by them. So I think we have to take the entire $11 million, take a look and determine whether the contract was given to them appropriately in the first place. Because, it's my position that companies who don't pay taxes because they move offshore have a built-in unfair advantage in the bidding process. They are automatically going to have a lower bid than companies who play by the rules, who pay their fair share. So, I'm asking a state agency who's in charge of procurement policies to look at this, to review these contracts, and make a policy determination as to whether we should ban these companies from getting contracts.
DOBBS: We should point out that your legislation was passed unanimously in the House, 113-0, and then defeated in the Senate in Illinois.
Any prospect that you can prevail ultimately?
HYNES: I think so. I mean, the vote in the House showed that this is bipartisan. There is tremendous support, unanimous support. It wasn't even voted on in the Senate. That's the real crime here. It was just killed silently, put into a subcommittee.
DOBBS: Who killed it?
HYNES: Well, the leadership in the Senate.
DOBBS: Who's the leadership?
HYNES: They're Democratic, which is my party. That's why I think this crosses party lines. It shows, though, that if it is given a chance to be voted on, as it was in the House, we will be able to pass this legislature because it is an issue that nobody disagrees with. Companies that move offshore shouldn't be given contracts.
DOBBS: But too few people, and I suspect you would agree with me on this, Dan Hynes, is there is a remarkable lack of political courage on this issue, not only in state Houses but Congress and, certainly, in Washington, D.C.
HYNES: Well, not only that, but Accenture has hired some big guns to lobby for them in Illinois and throughout the country. And I think that's a big part of what's happening.
DOBBS: Well, we applaud your courage in taking the issue on and fighting the good fight. We wish you all of the very best.
HYNES: Thanks, Lou.
DOBBS: Dan Hynes.
Turning now to a remarkable story from halfway around the world. A meteorite crashed into a home in Auckland, New Zealand. The almost -- there it is -- three-pound rock blasted through the roof and bounced off a couch before it landed on the floor if one can imagine a meteor bouncing off a couch. The family who lives in the home was just one room away, they were making breakfast when the meteor struck. It is only the ninth meteorite ever found in New Zealand.
By the way, the president of the American Statistical Association, Bradley Efron, tells us that the odds of a meteorite hitting your home -- are you ready? -- are one in a billion. As we see, sometimes even one in a billion, 10 billion odds come true. Still ahead here, the economy is this week's focus in the race for the White House. I'll be talking with one of Senator Kerry's top economic advisers, Gene Sperling. And "America Works." Our series of special reports this week in which we celebrate the hard-working Americans who keep this country strong. Tonight, the story of a man who has kept swimmers in New York safe, literally, for decades. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The economy will be a major issue in the campaign for the presidency this week. Both President Bush and Senator Kerry plan to focus on jobs. Four key states across the country will see a Bush campaign ad talking about higher job growth. The economy has created nearly a million new jobs in just the last three months, more -- just over a million of them since the beginning of the year. The Kerry campaign today however began a broad appeal to the middle-class voters based on what Senator Kerry calls a wage recession brought on by, he says, the president's economic policies. Gene Sperling is economic adviser to the Kerry campaign, a senior fellow at the Council of Foreign Relations and joins us tonight from Washington. Gene, good to have you here.
The Bush administration pointing, rightfully so, to strong economic growth. We've seen, basically, five quarters where we've seen growth booming. Job creation, 1.2 million jobs so far this year. That's a tough thing for you to combat, isn't it?
GENE SPERLING, COUNCIL ON FOREIGN RELATIONS: No, really not at all, Lou. It's a little bit like a college student who gets Ds for three and a half years and then gets a B minus in his last semester. It is hard to pull up. You don't make honor roll with one semester -- a B minus. Nor does an economy that has had this type of weakness in the labor market suddenly get better for the average working families just with a few good months.
Lou, I know people may think it is just a political charge when we say that he will be the first president to lose jobs since the Great Depression, but you really have to look at the fact that during a normal recovery, we usually create a few hundred thousand or 200,000 or 300,000 jobs every month. If you look at the administration's own predictions, based on typical recovery, they were expecting to have 138 million jobs in the economy. We're at 131 million. When you're 7 million short, a few good months is certainly good news. It is a step in the right direction. But it is a long, long way, Lou, from starting to get typical families feeling like this economy is working for them.
DOBBS: I take your point entirely, Gene, but in this country, as you well know, it is like the old saying. "If somebody else loses a job, it is a recession. If you lose yours, it is a depression." We are seeing job growth. It is not the level that we've experienced before. We've had 10 years of 3.5 million a year. It looks like we're looking at around 2.5 million this year. But the issues that are affecting us, we just reported the trade deficit growing astronomically in record highs. We are seeing fewer exports. The manufacturing base is already lower than it was three years ago. What is Senator Kerry going to do about those very important issues, the trade deficit, the manufacturing base? How is he going to change the situation that we see here?
SPERLING: Well, Lou, Senator Kerry has put out a very strong plan for creating jobs in the United States. First, as you know, he has called for reforming our international tax codes so that we take away the deferral incentives to move jobs oversees and then keep retained (ph) earnings oversees permanently. Instead he would used that money to actually lower the corporate tax rate for 99 percent of businesses here.
He's called for new jobs tax credit, he's called for at least having the same level of enforcement on our trade agreements that President Clinton had during his administration. And he's talked about having a conference (ph) of plan to lowering the cost of businesses and creating jobs here in terms of health care premiums, doing something about how catastrophic costs are making it noncompetitive for the United States businesses to create jobs here, making us more energy independent. That's the kind of comprehensive plan that makes us more competitive and will make the prospect for creating jobs here stronger.
DOBBS: Competitive is something we hear from both the Democrats and the Republicans. We heard it from the Clinton administration and now we hear it from the Bush administration supporting multinationals who, basically, what I see, have unfettered influence throughout our political system and certainly Washington D.C. Meanwhile trade deficits rise. We have to import more capital. We are less competitive, not more competitive, and we continue to see huge numbers of jobs outsourced, basically putting the American working man and woman in direct competition with third-world labor. What's the senator going to do now to stop it now because -- I understand there are long-term solutions but the pain and the impact, as you know, is short term.
SPERLING: Absolutely, Lou. I think I mentioned a few things. This administration has had the worst record on trade enforcement. Yes, Charlene Barshefsky, our trade adviser who worked her whole life on the China trade agreement. She would have been the first to tell you that you had to be tough every single step of the way on currency manipulation, on trade enforcement. This administration has not enforced our trade agreements.
And Lou, when you talk about competitiveness, understand what Senator Kerry is talking about. It's not how many favors you give companies. It is about whether the health situation, whether the technology situation in the United States is such that we are becoming a magnet for job creation.
And, Lou, just going back to your first point. There's still 5.6 percent unemployed. We still have 40 percent more people working part-time that want to work full-time. We have most people looking, who have been unemployed for more than six months since 1984. I think you're right. The people want to look around and see how they and their neighbors are doing. I think what they're seeing is their wages are down. Weekly wages are actually lower than they were in December 2001. While health care costs are up, while education costs are up, while gas taxes are up. And while they're looking, Lou, as you said at an administration that stands on the sidelines and doesn't fight hard for the jobs of the future or current.
DOBBS: Gene Sperling, it is good to have you with us. We thank you. And we look forward to seeing this campaign unfold and hearing more from the senator on the important issue that is going to affect all of our futures. Thank you, Gene Sperling.
SPERLING: Thank you.
DOBBS: When we continue, "America Works." We celebrate this week, the hard-working men and women who make this country great. Tonight, we'll introduce you to a man whose made a career out of saving lives. We'll have his story next. Please, stay with us.
(COMMERCIAL BREAK)
DOBBS: On Wall Street, some losses. The Dow down 75, the Nasdaq dropped almost 30, the S&P 500 down 11. New controversy over Sarbanes-Oxley, corporate reform of governance. It was designed to reform American companies in the wake of corporate crime scandals. But now some of the CEOs are saying the costs are just too high.
Christine Romans is here -- Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: Lou, to the whiners who say that corporate reform and better corporate governance are a costly burden, pipe down, that's the message from former fed chief Paul Volcker, and former SEC chairman Arthur Levitt. They offer in today's "Wall Street Journal" op-ed pages a spirited defense of Sarbanes-Oxley reform. They say corporate America is paying now for its lack of leadership that led to the scandals of the past few years. Companies cry they'll have to spend millions to meet the new higher standards of conduct. Levitt and Volcker say the cost of corporate integrity isn't much when compared to what investors have lost to a lack of integrity. And they reject the argument that foreign companies won't list their stocks here because of the supposed burdens of reform. That argument put forth by New York Stock Exchange CEO John Thain -- Lou.
DOBBS: This is the same New York Stock Exchange that is insisting on better governance? My goodness, how surprising.
ROMANS: Governance costs.
DOBBS: Lack of governance costs more. Thanks, Christine.
This week we'll feature our special reports all week long. "America Works." We bring you the stories of the hard-working Americans who make this country run. Tonight, we introduce you to a man who's kept watch over New York's beaches for more than four decades.
Bill Tucker has the story.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): Welcome to George's office. George is a lifeguard on New York's Fire Island, a job that offers good views, opportunity for exercise...
GEORGE MUNNICH: So soothing when you're in there swimming, riding waves, surfing.
TUCKER: For over 40 years he's been standing guard over swimmers on New York beaches.
MUNNICH: Forty-one years. This is my 41st season on the beach.
TUCKER: If you ask George, if he's ever saved anyone's life, he answers modestly.
MUNNICH: Over the years, probably, hundreds, but I like to say, "we made the rescues."
TUCKER: Rescues, he emphasizes are the result of teamwork.
And what about sharks?
I mean, what's a beach without a shark scare?
MUNNICH: From the time I've been on the beaches, we've had several sightings over the years. Not a lot of sharks, but I was never involved with -- on the beach of anybody being attacked.
TUCKER: And over the years, lots of important moments have happened on the beach. He met his wife while working on the beach.
LILLY ANN MUNNICH: OK. That would be the summer of 1966. And I started working at Jones Beach at the West Bath House, and he was a lifeguard there at that time.
TUCKER: During his life, George has been a Merchant Marine, a teacher, a wrestling coach.
L.A. MUNNICH: He is in the athletic hall of fame at the United States Merchant Marine Academy in King's Point. It was the Hawaiian state champ in wrestling and the U.S./Canadian champion also.
TUCKER: Although he's retired from head coaching, George still works as an assistant wrestling coach at a local high school. And at 67, he has no plans on giving up this job.
MUNNICH: One of the older ones has 10 years on me, a gentleman called Reggae Jones (ph) at Jones Beach. He's back this year. You know, I don't know if I'll go that long, but...
TUCKER: But he might.
(on camera): Now, just imagine if this were the view from your desk. All right, it's almost enough to make you think about retirement.
Bill Tucker, CNN, Fire Island, New York.
(END VIDEOTAPE) DOBBS: We may have lost Bill on that one.
Still ahead, the results of our poll tonight. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Now, the results of our poll. Should the phrase "under God" be eliminated from the Pledge of Allegiance? Forty-nine percent of you said, yes; 42 said, no. Nine say it's only a minor issue.
We thank you for being with us. Join us tomorrow, Rodger Robinson, chairman of the U.S./China Commission will be here to talk about the strange relationship between the United States and China, the soaring trade deficit and that's tomorrow night. Please be with us.
For all of us here good night from New York.
"ANDERSON COOPER 360" is next.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired June 14, 2004 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU DOBBS, CNN ANCHOR: Tonight, the government stops a radical Islamist plot to kill thousands of Americans in a shopping mall in Ohio.
(BEGIN VIDEO CLIP)
JOHN ASHCROFT, ATTORNEY GENERAL: The American heartland was targeted for death and destruction by an Al Qaeda cell.
(END VIDEO CLIP)
DOBBS: Terror in Baghdad. A suicide bomber kills an American, four other Westerners helping to rebuild Iraq.
The State Department admits it made a big mistake when it said global terrorism declined last year. Congressman Henry Waxman says that's not good enough. He's furious. He's our guest tonight.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: One nation under God...
UNIDENTIFIED MALE: One nation under God...
(END VIDEO CLIP)
DOBBS: And a dramatic victory at the Supreme Court for supporters of the words "under God" in the Pledge of Allegiance.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: We are pleased that we can continue reciting the pledge each and every day in our schools.
(END VIDEO CLIP)
DOBBS: And more controversy over Bermuda-based Accenture's massive Homeland Security contract. Illinois State Comptroller Dan Hines is our guest.
ANNOUNCER: This is LOU DOBBS TONIGHT for Monday, June 14. Here now for an hour of news, debate and opinion is Lou Dobbs.
DOBBS: Good evening.
Tonight, Al Qaeda plotted to kill hundreds, possibly thousands of Americans in a shopping mall in Ohio.
The government today charged a Somali citizen with conspiring to help Al Qaeda blow up a mall in the Columbus area. Attorney General John Ashcroft today repeated its warning that al Qaeda wants to launch a major attack in this country.
Justice Correspondent Kelli Arena reports -- Kelli.
KELLI ARENA, CNN JUSTICE CORRESPONDENT: Lou, his name is Nuradin Abdi, and he's charged with providing material support to Al Qaeda. The government says that he plotted to blow up a shopping mall with convicted al Qaeda operative Iyman Faris.
(BEGIN VIDEO CLIP)
ASHCROFT: Upon returning to the Columbus, Ohio, area, it is alleged that Abdi along with admitted Al Qaeda operative Faris and other co-conspirators initiated a plot to blow up a Columbus area shopping mall. It is also alleged that in pursuit of this plot, Abdi received bomb-making instructions from one of those co-conspirators.
(END VIDEO CLIP)
ARENA: The FBI in Ohio says there is no information on which specific mall was being targeted, and agents there say the mall threat was just one of several associated with Abdi, but they would not go any further. Sources say Customs and FBI agents there had been surveilling him for a while before he was taken into immigration custody in November.
(BEGIN VIDEO CLIP)
KEVIN BROCK, FBI: There were a lot of reasons why we detained him during that time. A lot of things came into play. I can't get more specific than that. But we looked at every angle of this case as we made those judgments.
(END VIDEO CLIP)
ARENA: Abdi made an initial appearance in court today. He was not accompanied by a lawyer, and he did not enter a plea. Now two of his brothers spoke to the press outside the courtroom, and they insist their brother is innocent and not a terrorist -- Lou.
DOBBS: Kelli Arena.
Thank you.
In Baghdad today, a suicide car bomb targeted Western civilians trying to help rebuild Iraq. The explosion killed an American and four other Western contractors. At least eight Iraqis were also killed in the blast. It was the second car bomb attack in Baghdad in two days.
Guy Raz reports.
(BEGIN VIDEOTAPE)
GUY RAZ, CNN CORRESPONDENT (voice-over): Baghdad's landscape now characterized by chaos. A morning rush hour suicide car bombing this time, another explosion to join the cynical chorus of blasts here, the 17th car bomb in Iraq this month.
Westerners were targeted; Iraqis part of a terrorist's collateral damage. Among the dead, three foreign workers employed by General Electric. They were in Iraq to help restore the country's dilapidated electricity grid.
Near the site of the blast, charred bodies were pulled from the rubble of this three-story building. Burning vehicles smoldered in the middle of the road. Condemnations from all corners.
Still, those behind the attacks seem more determined than ever.
IYAD ALLAWI, INTERIM IRAQI PRIME MINISTER: We deplore this terrorist act and vow to get the criminals to justice.
RAZ: An angry crowd gathered around the bomb site. "America is the enemy of God," they chanted. Confused Iraqis passed along conspiracy theories blaming America, Jews and others, anyone except Iraqis.
(on camera): Less than a month before administrative authority is handed over to an Iraqi government, officials warn of more attacks to come. Most of them silently concede they'll be impossible to stop.
Guy Raz, CNN, Baghdad.
(END VIDEOTAPE)
DOBBS: Western contractors in Saudi Arabia are also being targeted by radical Islamist terrorists. Saudi police and troops are hunting Al Qaeda gunmen who kidnapped an American engineer who worked for Lockheed Martin. But tens of thousands of Americans remain in Saudi Arabia at least for now, despite warnings about the possibility of more attacks on Westerners and, in particular, Americans.
Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN BUSINESS CORRESPONDENT (voice-over): Lockheed put out this statement today about missing employee Paul Johnson: "Be assured the full attention and resources of this corporation are committed to support efforts to secure Paul's safe return."
Paul Johnson's son spoke outside his home in Florida.
PAUL JOHNSON II, SON OF MISSING AMERICAN: My father's company, Lockheed Martin -- they've been great. They've been keeping me informed.
PILGRIM: The U.S. Embassy has been informing Americans in Saudi Arabia for weeks, issuing a travel warning as far back as April 15, and yesterday outlining precautions to help Americans avoid attack. There are an estimated 35,000 Americans and 30,000 Britons working in Saudi Arabia. The Saudi government provides basic security, but additional precautions may be needed.
IAN BREMMER, EURASIA GROUP: The amount of security you're going to have to pay for is going to be very inconvenient. It's going to be prohibitively expensive. With the exception of direct oil-related investments, it's extremely difficult to find margins like that that will support that kind of work.
PILGRIM: The difference between previous rounds of attacks, such as the housing compound attack in 2003, is now individual victims appear to be targeted.
ROBERT JORDAN, FORMER U.S. AMBASSADOR TO SAUDI ARABIA: This is a new tactic by the terrorists, and I think we now are finding that there are a lot more of these terrorists inside Saudi Arabia than we believed even a year ago.
PILGRIM: For many, the lifestyle inside gated communities and the pay scale has been worth the risk.
DAVID ISBY, DEFENSE AND FOREIGN POLICY ANALYST: I think Saudi Arabia is that important to the West and the links are so deep that terrorists will not cause people to cut and run.
PILGRIM: So far, experts say there has been no mass exodus, although there are no official figures on how many have left.
(END VIDEOTAPE)
PILGRIM: The State Department warning says private American citizens in Saudi Arabia are strongly urged to leave and U.S. citizens should put off traveling there. However, U.S. Secretary of State Colin Powell said yesterday in an interview the United States would do everything it could to help Saudi Arabia retain its foreign workforce -- Lou.
DOBBS: So the State Department is warning Americans to get out of Saudi Arabia while the secretary of state is telling Americans to remain?
PILGRIM: In fact, giving verbal support to keeping the workforce intact, and the State Department today reiterated that warning, that Americans should take that warning seriously. So it's very much a mixed message.
DOBBS: And, at the same time, the companies are not providing security for their employees, the American companies, because the Saudis won't permit them.
PILGRIM: The Saudis like to provide their own security. They prefer that system, which seems not to be working all that well.
DOBBS: Kitty Pilgrim. Thank you.
The United States and the United Nations today told Iran to come clean about its nuclear program. The White House says Iran is trying to develop nuclear weapons. White House Spokesman Scott McClellan called upon Iran to abide by its international agreements.
The head of the International Atomic Energy Agency, Mohamed ElBaradei, said Iran's cooperation with inspectors has been "less than satisfactory." ElBaradei said Iran must provide assurances about its nuclear program within months. Baradei did not say what would happen if Iran fails to comply.
Still ahead here tonight, outrage over the State Department's faulty report claiming the number of terrorist attacks declined last year. Democratic Congressman Henry Waxman is furious about the mistake and the time that it took the State Department to respond to his inquiries. He's our guest next.
And the Supreme Court today sidestepped the controversy over the Pledge of Allegiance in public schools and the words within it, "under God." Tonight, we talk with two experts on the law who have very different views on the issue.
And exporting America. A multibillion-dollar national security contract for Bermuda-based Accenture just one controversy involving the company. A top official in Illinois wants his state to avoid all business with Accenture. He's our guest, still ahead.
(COMMERCIAL BREAK)
DOBBS: Secretary of State Colin Powell is promising a full investigation of an incorrect State Department report on global terrorism. The report incorrectly stated that the number of terrorist attacks fell last year when, in fact, the number of such attacks rose.
My guest tonight was among the very first in Congress to challenge the initial findings of this report. Democratic Congressman Henry Waxman has called on Secretary Powell to give a full explanation as to how such a mistake could occur. Congressman Waxman joins me tonight from Washington, D.C.
Congressman, good to have you here.
REP. HENRY WAXMAN (D), CALIFORNIA: Thank you. Good to be with you.
DOBBS: You became suspicious of this report almost as soon as it was out. Why?
WAXMAN: I became suspicious of it because the numbers didn't seem right. Suddenly, we saw terrorism going down in 2003 because, for some reason or another, they decided to combine significant terrorist attacks with nonsignificant terrorist attacks, whatever they are, and, as a result of combining the two, they said terrorism was at a 34-year low, and that couldn't be in a year when we had bombings in Turkey, Saudi Arabia and Iraq, and in Israel, all around the world. It didn't seem like a quiet time for terrorism.
This report that the State Department put out is supposed to be the authoritative report on terrorism. It's supposed to be of use for government agencies in the United States and for other countries around the world to know what trends there are in terrorism.
When they put out this report, the State Department immediately jumped on it and said look what a great job we're doing. Terrorism is going down. It turns out, however, when you really look at it, terrorism went up, and it's the highest in 20 years.
DOBBS: Congressman Waxman, I want to quote, if I may, from your letter to Secretary of State Powell because it contains, I think, a wonderful sentence, and it says, "After your analysis, this leads to the bizarre conclusion that each significant terror attack is detailed in a public report, but information," which you requested, "regarding the so-called nonsignificant attacks is withheld from Congress." Any explanation to date as to how that could be?
WAXMAN: I really don't understand it. We wrote to Secretary Powell on May 17. I got a call from him last Thursday, June 10, a day after the story broke in the "L.A. Times." He insisted when he talked to me that the numbers were not being cooked for political purposes. It was incompetence, it was a mistake, and he's going to redo through the report.
I asked him if he'd answer our letter because one of the things I wanted to know is what are these nonsignificant terrorist attacks, was this done by professional people, or was it done by political people. I told him he could see why I might be suspicious that it was politically motivated because they immediately took credit for the reduction in terrorism and the president is running on his record in the war against terrorism.
But I take him at his word. It's just give him the benefit of the doubt, incompetence, and that doesn't speak well for our efforts to really know what's happening about terrorism.
DOBBS: I find the word "incompetence" to be chilling. Equally so, I would find the expression "politically motivated" chilling. In either case, it's not a happy result. Did the secretary of state offer anything beyond that rather cursory explanation?
WAXMAN: Well, he said that he was going to find out what happened, get to the bottom of it. He was disturbed himself at the result of a report that was so far off the mark.
The report was really worthless. No one could use it for any real legitimate purpose. It was requested so that it could give information that would help us in fighting terrorism, and the result of this report is just to have a document that's so way off the mark of what really happened that it's of no value, except for somebody who wants to claim they're doing a good job in this administration lowering terrorism rates, but, when you look at the reality, terrorism in 2003 was at a 20-year high. DOBBS: Congressman, you're also questioning Vice President Dick Cheney about whether he knew about the Halliburton contract to repair Iraqi oil fields before it was granted. What makes you, obviously, suspect that he did?
WAXMAN: He has insisted for months now that he and his office had nothing to do with the award of the sole source contract to Halliburton, and people in the administration have also insisted that this was done by the career people in the Army and not by political people.
Well, we now have information from a briefing our staff received last week that, in fact the whole thing was brought to a meeting of the political appointees, including Scooter Libby, who is Vice President Cheney's chief of staff, and the reason it was brought to them is that they wanted to be sure that they didn't have any objection that they were going to go to Halliburton, even though there are other companies that could do the job. So...
DOBBS: So you're basing that...
WAXMAN: ... I've written to Vice President Cheney and asked him for a full explanation.
DOBBS: OK. A spokesman for the vice president says that your allegations, if you will, are politically motivated. How do you respond?
WAXMAN: Well, I've made no allegations. I'm simply reporting what the fellow that works for the Defense Department has told us in a meeting, that he brought this to Mr. Cheney's chief of staff, he brought it to the political people, and the decision was not made by the career people, but by the political people.
So I've asked Vice President Cheney, without making any accusations about him, because we don't really know the truth at this point, we don't know the full story. But we do know that what he's been saying is inconsistent with the facts as we've now learned them.
DOBBS: Congressman Waxman, only in Washington could that be considered not an allegation, to suggest the facts are not in accordance with the statement.
WAXMAN: Well...
DOBBS: A lot...
(CROSSTALK)
WAXMAN: ... to learn more about it.
DOBBS: In other parts of the country, that could be called an outright lie. But we appreciate, Congressman Waxman, you being here. We appreciate it.
WAXMAN: Thank you. DOBBS: Still ahead, "under God" preserved for now. We'll talk to two legal experts about today's Supreme Court ruling.
Also, a new form of bank robbery, and it's online. Literally millions of accounts have had money stolen, and some of those holders of those accounts don't even know about it yet. We'll have a special report to bring you up to date.
And blown away in the Midwest. A string of devastating tornadoes struck the region over the weekend.
We'll have that and a great deal more, still ahead. Stay with us.
(COMMERCIAL BREAK)
ANNOUNCER: LOU DOBBS TONIGHT continues. Sitting in for Lou Dobbs, Kitty Pilgrim.
DOBBS: Sitting in for Lou Dobbs is Lou Dobbs this evening.
The Supreme Court today ruled against a challenge to the Pledge of Allegiance in public schools. The ruling means children will continue to say the pledge in school.
Michael Newdow, an atheist, claimed his daughter's First Amendment rights were violated when her classmates recited the pledge. But Newdow does not have custody of his daughter, and, technically, that caused the Supreme Court to rule against him, suggesting he did not have any standing.
In today's ruling, Justice John Paul Stevens wrote, "When hard questions of domestic relations are sure to affect the outcome, a prudent course is for the federal court to stay its hand rather than reach out to resolve a weighty question of federal constitutional law."
Joining me now to discuss the ruling, in Washington, Barry Lynn, who's executive director of Americans United for Separation of Church and State, and Jay Sekulow, who is chief counsel for the American Center for Law and Justice, joining us tonight from Virginia.
Thank you both for being here.
JAY SEKULOW, AMERICAN CENTER FOR LAW AND JUSTICE: Thanks, Lou.
BARRY LYNN, AMERICANS UNITED FOR SEPARATION OF CHURCH AND STATE: Thank you.
DOBBS: This is -- well, I'll wait for you to characterize it -- but a surprising ending to this issue based on a technicality.
Barry, your thoughts?
LYNN: Yes, I'm really disappointed that they punted on this one, that they didn't get to the weighty constitutional issue that Justice Stevens talked about.
The question here has always been: Should children in a public school be required or effectively feel pressured to participate in what amounts to a religious loyalty oath, to say not just I affirm that I love my country, but, also, that I believe in one God?
We have a tremendous multitude of religions, over 2,000 in this country, 10 million to 20 million nonbelievers. I think they should all be able to be first-class patriots, affirm love of country, without getting into the religious angle.
And, in fact, in 1892, Lou, when this was written...
DOBBS: Jay...
LYNN: ... by a minister, that minister didn't put any religious language in the Pledge of Allegiance.
DOBBS: Jay...
SEKULOW: Of course, the Supreme Court didn't write that opinion today. What they said was something that all of us that were involved in the case advocated, that the first issue in the case was: Should Michael Newdow have been able to bring this in federal court in the first place? And the court was pretty clear in that, saying absolutely not, which was the first issue they had had to address.
With regard to the merits of the case, Barry's right in part in that the court did not decide the case on its merits, at least the merits as to the "under God" phrase.
But there is an important vote here and one that both Barry and I look at regularly, and that is where does Justice O'Connor come out on this because, Lou, oftentimes, it's Justice O'Connor's vote on these cases that is the pivotal vote, called the swing vote. Many of these cases are 5-4 splits.
She said today that she would have reached the merits of the case and decided that the Pledge of Allegiance was, in fact, constitutional with the phrase "under God" in place, and I think that does...
LYNN: Well, you know, Jay...
SEKULOW: ... send a message there, at least as far as her vote's concerned.
LYNN: Well, here's what I think the message is, Lou, and I think the message is since five people did not express an opinion, I would not be surprised if over the next few weeks or months, another parent, this time a parent that does have custody of his or her child, will file the same suit, probably in California, hoping that it follows the same trajectory. That is, an affirmation by...
DOBBS: Does it...
LYNN: ... the Ninth Circuit that the pledge is unconstitutional with "under God," and we'll get this case back to the Supreme Court in a couple of years.
DOBBS: Well, affirmations by the Ninth Circuit Court have -- it's the most overturned appellate court in the country.
SEKULOW: And here, it was today again.
DOBBS: More interesting, at least to me, Jay, is the question -- excuse me, Barry, as Jay just pointed out, Sandra Day O'Connor, Justice O'Connor tipping her hand, if you will. That must concern you.
LYNN: Well, it does. It concerns me. But it also means that Justice Kennedy, who also could have participated and decided this case on the merits, decided not to state an opinion, and I think that this is going to mean that people will be lining up to file further lawsuits on this very question because it is terribly important, and I think Jay concurs, at least in this much, that when you're talking about minority religions that are growing in this country, nonbelievers...
SEKULOW: Yes, but she put the -- Justice O'Connor...
LYNN: ... that they have rights, too.
SEKULOW: ... had it right, Barry, when she put the pledge in its historical context, why the phrase was in there. It was an acknowledgment that our founding generation believed that the liberties and freedoms that we enjoy as Americans are not a gift from government, that they're a gift from God. The role of government is to protect those. That's what she said in her opinion.
LYNN: Jay, wait a minute. Our founders didn't write the pledge. Our founders, by the way, weren't even around in 1954 when this was amended under pressure from the so-called religious right of its day to make sure that America said we're religious; Russians, you're not.
DOBBS: Let me ask you both. These were sort of magical words from the U.S. Supreme Court, it seemed to me, suggesting that it is a prudent course for the federal court to stay its hand. Those are words we don't often hear from this court.
Is there a possibility that the court would stay its hand in future cases, irrespective of the technicalities, because there becomes an issue, it seems to me -- and I'd love because you're two of the most thoughtful people on this issue in the country.
It seems there comes a question of proportionality, of all that a child must hear, of all that a child must endure in our public school system, with all of the problems, the discipline problems and so forth in our educational system, it seems the words "under God" perhaps could be amongst the least offensive words that are polluting the air around them.
Is there any suggestion that perhaps those are rather mild words compared to others and there is an issue of proportionality here, Jay? SEKULOW: Justice Ginsburg -- interesting, Lou, and it's a great question. Justice Ginsburg brought that up during oral argument. She said, you know, the phrase "under God" -- she said, well, after all, we start off this proceeding "with God save the United States and this honorable court."
She called this statement something that's part of the American experience, and she almost said the same phrase you're using, that this really doesn't raise to the level of a constitutional crisis, and I think that is probably where a majority of the court would go on this.
We don't know that because we don't have an opinion, but I think you're absolutely correct. I think that's how the court was looking at it.
LYNN: You know, we don't always need a constitutional crisis in order to resolve an important constitutional issue. I do think, Lou, though that one possibility here is that the court, which also watches television and reads the newspapers, may have decided that this was not the time to decide this, to throw gasoline right on the cultural war fire that's going on, particularly in an election year.
But I think they can't duck it forever and I think there are enough people, religious and nonreligious, who will want to bring another case, that this can't be avoided in the long run.
DOBBS: Barry Lynn, Jay Sekulow, we thank you very much.
LYNN: Thanks, Lou.
SEKULOW: Thank you.
DOBBS: Gentlemen, appreciate your being here.
That brings us to the subject of our poll tonight, and the question an obvious follow to the discussion you just heard. Should the phrase "under God" be eliminated from the Pledge of Allegiance? Yes or no or a minor issue. Cast your vote at cnn.com/lou. We'll have the results for you later in the broadcast.
Tonight's thought is on celebration of Flag Day. Yes, today is Flag Day.
"A thoughtful mind, when it sees the nation's flag, sees not the flag only, but the nation itself; and whatever may be its symbols, its insignia, he reads chiefly in the flag, the government, the principles, the truths, the history which belongs to the nation that sets it forth."
That from American clergyman and writer Henry Ward Beecher.
The United States trade deficit exploded to another staggering record last month. The Commerce Department reports the trade deficit widened to more than $48 billion. The report also confirmed two alarming trends. This country has lost its edge in technology exports and rapidly is losing its edge in the services sector as well.
Peter Viles reports.
(BEGIN VIDEOTAPE)
PETER VILES, CNN CORRESPONDENT (voice-over): The American economy continues to set records, but these are records no one could be proud of, a record trade deficit, $48.3 billion in April. That is five record trade deficits in a row, and oil was not the problem. Oil imports fell. But so did U.S. exports, dropping $1.5 billion from March, all of which means more borrowing to pay for all those foreign goods.
CHARLES MCMILLION, MBG INFORMATION SERVICES: We are now borrowing about a million dollars a minute just to pay for all these imported cell phones and computers and cars and other things, and that has accumulated to over $3 trillion dollars just in the last dozen years.
UNIDENTIFIED FEMALE: Would you like your receipt in the bag, ma'am?
VILES: The United States runs a surplus in services, but that is shrinking from $64 billion in 2001 to just $51 billion last year, and some economists believe the government is missing the boom in outsourcing to India.
ROBERT SCOTT, ECONOMIC POLICY INSTITUTE: Official data suggests that we import only about $300 million a year in services, imports from India, and yet the Indian statistics suggest that they're exporting several billion a year to the United States.
VILES: Conventional wisdom says the overall trade deficit reflects products such as sneakers, electronics, and toys. Products the American economy doesn't really make, but that is not the case. Autos and auto parts are a bulwark of U.S. manufacturing, but the deficit there is widening. And the U.S. trade advantage in technology is gone. We ran a $3 billion deficit in April in what the government calls advanced technology products.
(END VIDEOTAPE)
VILES: And then there is the China syndrome. The trade deficit with China, just under $12 billion in April. It is running 24 percent of last year's pace. Last year was a record 124 billion, running well ahead of that, Lou.
DOBBS: U.S. exports declining, the deficit widening, no advantage in technology, services declining as well. Yet corporate America and this administration and most private economists continue to say, don't worry about the jobs being lost. We'll make it up in technology and high-value jobs.
VILES: It's like the company that loses money and says it will make it up in volume. The trend is worsening.
DOBBS: Peter Viles, thank you, sir.
Taking a look now at some "Your Thoughts" on the subject of "Exporting America."
Jim Rice of Red Bank, Tennessee, "The trade gap has now reached record levels and no one in this administration seems to care. We are the greatest market in the world. Can't we use that for leverage to level the playing field for our workers?"
Matthew Harper of Vienna, West Virginia, "I understand your concerns with the outsourcing of jobs. But I think you are ignoring a major fact in this issue. It is true that many jobs are leaving the United States, but by far more jobs are coming in.
Well, unfortunately, that is absolutely not true. It is the reverse, I'm sorry to inform you.
Leslie Sora, Delmont, Pennsylvania, "Not only are American companies sending jobs overseas, but the returning product is of substandard quality as well. I've lost count on the returns I've made for towels that shred after two washes, clothing with crooked seams, buttons sewn on with two threads, misshapen glassware, bed sheets that barely fit the mattress, the list goes on. Americans must begin to return this junk even if it's only 50 cents."
Maybe they will get the message, but I doubt it.
We thank you for "Your Thoughts." Send them to us at loudobbs@cnn.com. We'll share more of "Your Thoughts" later here in the broadcast tonight.
A disturbing new report tonight on identity theft. Gartner Consulting reporting that nearly two million Americans were the victims of online theft last year. Thieves stole more than $2 billion from the checking accounts of those people across the country. And they did it all, of course, electronically.
Lisa Sylvester, reports from Washington.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Thieves have found a new way to tap into consumers' bank accounts. They don't even have to steal personal information, they just ask for it. It's called phishing. Criminals send out phony e-mails requesting bank information updates with a link to a fake Web site. It is almost impossible to tell the difference between this phony Fleet Bank Web site and the real one.
AVILA LITAN, GARTNER CONSULTING: Even though it may say in your e-mail a legitimate Web site, hidden behind that address is the crook's address.
SYLVESTER: For identity theft victims, clearing their names can take years. Sharon Jones has a pile of letters from creditors demanding payment for bills that are not hers. SHARON JONES, IDENTITY THEFT VICTIM: It's been a total nightmare because you never know when something else is going to pop up, so you have to constantly check your credit report.
SYLVESTER: Phishing e-mails have increased 4,000 percent in the past six months according to the Anti-Phishing Working Group, which includes Internet providers, banks and law enforcement officials. Citibank, eBay and PayPal are the most common targets. But consumers can protect themselves by looking for tip-offs such as misspelled words and by not clicking on links, even that look legitimate.
DAVID JEVANS, ANTI-PHISHING WORKING GROUP: The most effective thing is to really open up a Web browser window and go directly to the bank, yourself. Type in the address, into the Web browser, rather than relying on the link.
SYLVESTER: The financial and computer industries are working on standards to authenticate e-mail. In the meantime, banks will reimburse victims of credit and checking account scams provided they're reported within two months.
(END VIDEOTAPE)
SYLVESTER: There's another growing trend in identity theft called Trojan horse or spyware. Consumers are sent a link, and when they open it, they have unknowingly downloaded spyware software, that records every keystroke, including personal financial information -- Lou.
DOBBS: That is troubling, to say the least. Lisa, thank you very much. Lisa Sylvester reporting tonight from Washington.
Residents in parts of Southern Kansas tonight are cleaning up after powerful tornadoes hit over the weekend. The most powerful of six tornadoes destroyed one house in Mulvane. Fortunately, no one was home when the storm hit. These are incredible images. The governor of Kansas has declared a state of disaster for 12 counties.
Storms in Texas have dumped heavy rains in the southeastern part of the state. Roads and highways remain flooded tonight. Officials said about 13,000 homes and businesses lost power at the height of the storm.
New Mexico could use a little of that rain to help battle a wildfire that has now burned about 2,500 acres in the western part of the state. Officials say the fire was sparked by a camp fire.
Still to come, fighting the exporting of American government jobs to foreign companies.
Illinois state comptroller, Dan Hynes, says it is unpatriotic, and he's leading the effort in his state to stop it. He is our guest.
And putting Americans back to work. Senator Kerry says he has a plan. Senator Kerry's, economic adviser, Gene Sperling is our guest.
(COMMERCIAL BREAK)
DOBBS: It's been nearly two weeks since the federal government awarded a border security contract, worth possibly as much as $10 billion to a foreign based company.
The Department of Homeland Security chose Accenture over two American based companies to create an integrated system that would track U.S. visitors and immigrants.
My next guest says companies like Accenture are what he calls expatriate corporations and he wants to make sure they don't receive contracts from the state of Illinois. He says it's an issue of fairness and in some ways patriotism.
Joining me now, Illinois State Comptroller Dan Hynes. Good to have you with us.
DAN HYNES, ILLINOIS STATE COMPTROLLER: Thank you. Good to be here.
DOBBS: You have taken this battle on in a state. You were actually in contest with your governor, in point of fact, over the awarding of contracts to foreign-based companies.
What is the status of your -- your fight to avoid that?
HYNES: Well, we tried to pass legislation in Illinois to stop companies who move offshore from getting state contracts. Unfortunately, my legislation stalled in the Illinois legislature. Meanwhile, one of those companies, Accenture, got an $11 million bid or contract to do computer services for the state. So we have blocked $2 million in contracts because we don't believe we should be giving tax dollars to companies who move offshore to avoid paying taxes. It is an issue of patriotism. I do think it's unfair because all of us pick up the slack. We have to pay higher taxes because these companies want to build their bottom line by avoiding their taxes.
DOBBS: You've also refused to pay $2 million that everyone, apparently, agrees is owed Accenture for work it's done in the past and withholding that. I'll tell you frankly, it seems to me a little unfair.
If they've done the work, why not write them the check?
HYNES: Well, we're going to find out whether, in fact, we have to pay them for work performed. But there's still $9 million pending of contractual obligation that have not been earned by them. So I think we have to take the entire $11 million, take a look and determine whether the contract was given to them appropriately in the first place. Because, it's my position that companies who don't pay taxes because they move offshore have a built-in unfair advantage in the bidding process. They are automatically going to have a lower bid than companies who play by the rules, who pay their fair share. So, I'm asking a state agency who's in charge of procurement policies to look at this, to review these contracts, and make a policy determination as to whether we should ban these companies from getting contracts.
DOBBS: We should point out that your legislation was passed unanimously in the House, 113-0, and then defeated in the Senate in Illinois.
Any prospect that you can prevail ultimately?
HYNES: I think so. I mean, the vote in the House showed that this is bipartisan. There is tremendous support, unanimous support. It wasn't even voted on in the Senate. That's the real crime here. It was just killed silently, put into a subcommittee.
DOBBS: Who killed it?
HYNES: Well, the leadership in the Senate.
DOBBS: Who's the leadership?
HYNES: They're Democratic, which is my party. That's why I think this crosses party lines. It shows, though, that if it is given a chance to be voted on, as it was in the House, we will be able to pass this legislature because it is an issue that nobody disagrees with. Companies that move offshore shouldn't be given contracts.
DOBBS: But too few people, and I suspect you would agree with me on this, Dan Hynes, is there is a remarkable lack of political courage on this issue, not only in state Houses but Congress and, certainly, in Washington, D.C.
HYNES: Well, not only that, but Accenture has hired some big guns to lobby for them in Illinois and throughout the country. And I think that's a big part of what's happening.
DOBBS: Well, we applaud your courage in taking the issue on and fighting the good fight. We wish you all of the very best.
HYNES: Thanks, Lou.
DOBBS: Dan Hynes.
Turning now to a remarkable story from halfway around the world. A meteorite crashed into a home in Auckland, New Zealand. The almost -- there it is -- three-pound rock blasted through the roof and bounced off a couch before it landed on the floor if one can imagine a meteor bouncing off a couch. The family who lives in the home was just one room away, they were making breakfast when the meteor struck. It is only the ninth meteorite ever found in New Zealand.
By the way, the president of the American Statistical Association, Bradley Efron, tells us that the odds of a meteorite hitting your home -- are you ready? -- are one in a billion. As we see, sometimes even one in a billion, 10 billion odds come true. Still ahead here, the economy is this week's focus in the race for the White House. I'll be talking with one of Senator Kerry's top economic advisers, Gene Sperling. And "America Works." Our series of special reports this week in which we celebrate the hard-working Americans who keep this country strong. Tonight, the story of a man who has kept swimmers in New York safe, literally, for decades. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The economy will be a major issue in the campaign for the presidency this week. Both President Bush and Senator Kerry plan to focus on jobs. Four key states across the country will see a Bush campaign ad talking about higher job growth. The economy has created nearly a million new jobs in just the last three months, more -- just over a million of them since the beginning of the year. The Kerry campaign today however began a broad appeal to the middle-class voters based on what Senator Kerry calls a wage recession brought on by, he says, the president's economic policies. Gene Sperling is economic adviser to the Kerry campaign, a senior fellow at the Council of Foreign Relations and joins us tonight from Washington. Gene, good to have you here.
The Bush administration pointing, rightfully so, to strong economic growth. We've seen, basically, five quarters where we've seen growth booming. Job creation, 1.2 million jobs so far this year. That's a tough thing for you to combat, isn't it?
GENE SPERLING, COUNCIL ON FOREIGN RELATIONS: No, really not at all, Lou. It's a little bit like a college student who gets Ds for three and a half years and then gets a B minus in his last semester. It is hard to pull up. You don't make honor roll with one semester -- a B minus. Nor does an economy that has had this type of weakness in the labor market suddenly get better for the average working families just with a few good months.
Lou, I know people may think it is just a political charge when we say that he will be the first president to lose jobs since the Great Depression, but you really have to look at the fact that during a normal recovery, we usually create a few hundred thousand or 200,000 or 300,000 jobs every month. If you look at the administration's own predictions, based on typical recovery, they were expecting to have 138 million jobs in the economy. We're at 131 million. When you're 7 million short, a few good months is certainly good news. It is a step in the right direction. But it is a long, long way, Lou, from starting to get typical families feeling like this economy is working for them.
DOBBS: I take your point entirely, Gene, but in this country, as you well know, it is like the old saying. "If somebody else loses a job, it is a recession. If you lose yours, it is a depression." We are seeing job growth. It is not the level that we've experienced before. We've had 10 years of 3.5 million a year. It looks like we're looking at around 2.5 million this year. But the issues that are affecting us, we just reported the trade deficit growing astronomically in record highs. We are seeing fewer exports. The manufacturing base is already lower than it was three years ago. What is Senator Kerry going to do about those very important issues, the trade deficit, the manufacturing base? How is he going to change the situation that we see here?
SPERLING: Well, Lou, Senator Kerry has put out a very strong plan for creating jobs in the United States. First, as you know, he has called for reforming our international tax codes so that we take away the deferral incentives to move jobs oversees and then keep retained (ph) earnings oversees permanently. Instead he would used that money to actually lower the corporate tax rate for 99 percent of businesses here.
He's called for new jobs tax credit, he's called for at least having the same level of enforcement on our trade agreements that President Clinton had during his administration. And he's talked about having a conference (ph) of plan to lowering the cost of businesses and creating jobs here in terms of health care premiums, doing something about how catastrophic costs are making it noncompetitive for the United States businesses to create jobs here, making us more energy independent. That's the kind of comprehensive plan that makes us more competitive and will make the prospect for creating jobs here stronger.
DOBBS: Competitive is something we hear from both the Democrats and the Republicans. We heard it from the Clinton administration and now we hear it from the Bush administration supporting multinationals who, basically, what I see, have unfettered influence throughout our political system and certainly Washington D.C. Meanwhile trade deficits rise. We have to import more capital. We are less competitive, not more competitive, and we continue to see huge numbers of jobs outsourced, basically putting the American working man and woman in direct competition with third-world labor. What's the senator going to do now to stop it now because -- I understand there are long-term solutions but the pain and the impact, as you know, is short term.
SPERLING: Absolutely, Lou. I think I mentioned a few things. This administration has had the worst record on trade enforcement. Yes, Charlene Barshefsky, our trade adviser who worked her whole life on the China trade agreement. She would have been the first to tell you that you had to be tough every single step of the way on currency manipulation, on trade enforcement. This administration has not enforced our trade agreements.
And Lou, when you talk about competitiveness, understand what Senator Kerry is talking about. It's not how many favors you give companies. It is about whether the health situation, whether the technology situation in the United States is such that we are becoming a magnet for job creation.
And, Lou, just going back to your first point. There's still 5.6 percent unemployed. We still have 40 percent more people working part-time that want to work full-time. We have most people looking, who have been unemployed for more than six months since 1984. I think you're right. The people want to look around and see how they and their neighbors are doing. I think what they're seeing is their wages are down. Weekly wages are actually lower than they were in December 2001. While health care costs are up, while education costs are up, while gas taxes are up. And while they're looking, Lou, as you said at an administration that stands on the sidelines and doesn't fight hard for the jobs of the future or current.
DOBBS: Gene Sperling, it is good to have you with us. We thank you. And we look forward to seeing this campaign unfold and hearing more from the senator on the important issue that is going to affect all of our futures. Thank you, Gene Sperling.
SPERLING: Thank you.
DOBBS: When we continue, "America Works." We celebrate this week, the hard-working men and women who make this country great. Tonight, we'll introduce you to a man whose made a career out of saving lives. We'll have his story next. Please, stay with us.
(COMMERCIAL BREAK)
DOBBS: On Wall Street, some losses. The Dow down 75, the Nasdaq dropped almost 30, the S&P 500 down 11. New controversy over Sarbanes-Oxley, corporate reform of governance. It was designed to reform American companies in the wake of corporate crime scandals. But now some of the CEOs are saying the costs are just too high.
Christine Romans is here -- Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: Lou, to the whiners who say that corporate reform and better corporate governance are a costly burden, pipe down, that's the message from former fed chief Paul Volcker, and former SEC chairman Arthur Levitt. They offer in today's "Wall Street Journal" op-ed pages a spirited defense of Sarbanes-Oxley reform. They say corporate America is paying now for its lack of leadership that led to the scandals of the past few years. Companies cry they'll have to spend millions to meet the new higher standards of conduct. Levitt and Volcker say the cost of corporate integrity isn't much when compared to what investors have lost to a lack of integrity. And they reject the argument that foreign companies won't list their stocks here because of the supposed burdens of reform. That argument put forth by New York Stock Exchange CEO John Thain -- Lou.
DOBBS: This is the same New York Stock Exchange that is insisting on better governance? My goodness, how surprising.
ROMANS: Governance costs.
DOBBS: Lack of governance costs more. Thanks, Christine.
This week we'll feature our special reports all week long. "America Works." We bring you the stories of the hard-working Americans who make this country run. Tonight, we introduce you to a man who's kept watch over New York's beaches for more than four decades.
Bill Tucker has the story.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): Welcome to George's office. George is a lifeguard on New York's Fire Island, a job that offers good views, opportunity for exercise...
GEORGE MUNNICH: So soothing when you're in there swimming, riding waves, surfing.
TUCKER: For over 40 years he's been standing guard over swimmers on New York beaches.
MUNNICH: Forty-one years. This is my 41st season on the beach.
TUCKER: If you ask George, if he's ever saved anyone's life, he answers modestly.
MUNNICH: Over the years, probably, hundreds, but I like to say, "we made the rescues."
TUCKER: Rescues, he emphasizes are the result of teamwork.
And what about sharks?
I mean, what's a beach without a shark scare?
MUNNICH: From the time I've been on the beaches, we've had several sightings over the years. Not a lot of sharks, but I was never involved with -- on the beach of anybody being attacked.
TUCKER: And over the years, lots of important moments have happened on the beach. He met his wife while working on the beach.
LILLY ANN MUNNICH: OK. That would be the summer of 1966. And I started working at Jones Beach at the West Bath House, and he was a lifeguard there at that time.
TUCKER: During his life, George has been a Merchant Marine, a teacher, a wrestling coach.
L.A. MUNNICH: He is in the athletic hall of fame at the United States Merchant Marine Academy in King's Point. It was the Hawaiian state champ in wrestling and the U.S./Canadian champion also.
TUCKER: Although he's retired from head coaching, George still works as an assistant wrestling coach at a local high school. And at 67, he has no plans on giving up this job.
MUNNICH: One of the older ones has 10 years on me, a gentleman called Reggae Jones (ph) at Jones Beach. He's back this year. You know, I don't know if I'll go that long, but...
TUCKER: But he might.
(on camera): Now, just imagine if this were the view from your desk. All right, it's almost enough to make you think about retirement.
Bill Tucker, CNN, Fire Island, New York.
(END VIDEOTAPE) DOBBS: We may have lost Bill on that one.
Still ahead, the results of our poll tonight. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Now, the results of our poll. Should the phrase "under God" be eliminated from the Pledge of Allegiance? Forty-nine percent of you said, yes; 42 said, no. Nine say it's only a minor issue.
We thank you for being with us. Join us tomorrow, Rodger Robinson, chairman of the U.S./China Commission will be here to talk about the strange relationship between the United States and China, the soaring trade deficit and that's tomorrow night. Please be with us.
For all of us here good night from New York.
"ANDERSON COOPER 360" is next.
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