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LOU DOBBS TONIGHT

Military Attack Underway Against Fallujah Insurgents; Bush, Kerry Step Up Activities on the Campaign Trail

Aired October 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, a major military operation in Iraq. The U.S. military and Iraqi forces advancing against insurgents in Fallujah. A ground and air attack is underway at this hour.
In Baghdad, successful attacks against the so-called green zone. At least three Americans have been killed by suicide bombers.

And tonight, with Election Day fast approaching, President Bush and Senator Kerry stepping up their activities on the campaign trail.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Now I'm running and I'm not going to stop until Election Day!

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

SEN. JOHN K. KERRY (D-MA), PRESIDENTIAL CANDIDATE: It's our moment. It's our time to seize and to choose the kind of future that we want.

(END VIDEO CLIP)

DOBBS: Former presidential adviser David Gergen is my guest tonight. We'll find out who he thinks won last night's debate and who he thinks will win this election.

And disturbing new evidence tonight that our government isn't doing enough to stop terrorists who could smuggle weapons of mass destruction into this country. We'll have a special report.

ANNOUNCER: This is LOU DOBBS TONIGHT for Thursday, October 14. Here now for an hour of news, debate and opinion is Lou Dobbs.

DOBBS: Good evening.

Tonight, U.S. Marines have launched a major assault on the insurgent stronghold of Fallujah west of Baghdad. American warplanes and artillery blasting suspected insurgent positions within the city. The attack comes one day after the Iraqi prime minister ordered Fallujah's leaders to hand over foreign fighters or face, as he put it, annihilation.

Senior Pentagon Correspondent Jamie McIntyre has our report -- Jamie.

JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT: Well, Lou, to put this in perspective, Pentagon officials are telling us that while this is a significant military operation, it is not yet the major offensive that's designed to take back control of Fallujah.

It is part of a stepped-up campaign to battle the insurgents in Fallujah, which included air strikes today against several targets that were believed to be associated with the terrorist network of Abu Musab al-Zarqawi, including several safe houses, illegal checkpoints and weapon storage areas.

A short time ago, I talked to Marine 1st Lieutenant Lyle Gilbert who described the operations that are going on on the ground.

(BEGIN VIDEO CLIP)

1ST LT. LYLE GILBERT, U.S. MARINES: We've been working on this every single day, dealing with insurgents and dealing with terrorists and thugs and the anti-Iraqi forces at large.

This particular operation is pretty invasive, and we've got aircraft, helicopters, fixed wing, as well as tanks and Marines, U.S. Army forces as well as Iraqi forces involved in this operation.

So it's a significant effort, and when, all is said and done, there's going to be a lot less of the anti-Iraqi forces than we're dealing with right now.

(END VIDEO CLIP)

MCINTYRE: Again, those U.S. and Iraqi forces on the ground will be operating, according to the Marines, in and around Fallujah.

But the U.S. military says this is as a result of intelligence that indicated that members of the Zarqawi network and other anti-U.S. forces were planning to step up attacks for Ramadan, which starts tomorrow.

This is an effort to cut them off at the knees essentially, try to undercut their ability to launch those attacks, while the major offensive is still to come in the future -- Lou.

DOBBS: Jamie, thank you.

Jamie McIntyre, our senior Pentagon correspondent.

Later here, I'll be talking with General David Grange about the force size and the strategy behind tonight's assault against Fallujah.

In Baghdad today, suicide bombers killed at least three Americans and two Iraqis all within the heavily fortified green zone of Baghdad. This is the first time insurgents have breached security and exploded bombs within the green zone.

Brent Sadler has our report. (BEGIN VIDEOTAPE)

BRENT SADLER, CNN BAGHDAD BUREAU CHIEF: Bombers strike Iraq's seat of power in Baghdad, infiltrating the green zone, damaging its fortress-like reputation. Two deadly blasts. U.S. Defense Department personnel among the fatalities.

A score of other people wounded, including Americans, British and Iraqi civilians. Some of the casualties flown by helicopter to a U.S. air base at Balad north of the capital, victims, it seems, of smuggled explosives rigged to detonate, possibly by at least one suicide bomber. Suspicion, too, attackers had inside help.

LARRY KAPLOW, COX NEWSPAPERS: And that's, I think, one of the biggest fears of people who are in the green zone, westerners who are in there, is that there may be Iraqis there who are now starting to be sympathetic with people who want to do these kind of attacks.

SADLER: Despite the major security breach, Iraqi officials say people were badly shaken, but undeterred.

KASIM DAWOOD, IRAQI NATIONAL SECURITY ADVISER: They reflect their braveness. They reflect their insistence that they are going to harm the Iraqis and stand bravely with the Iraqis to fight the terrorists.

SADLER: And that fight is spreading far and wide. U.S. troops exchanged heavy fire with rebels in Ramadi, following a series of raids on the Sunni Muslim stronghold. The operation appears to be part of escalating military action to step up pressure on insurgents ahead of the Islamic holy month of Ramadan that begins here Friday.

(on camera): The start of last year's Ramadan signaled an upsurge in violent attacks, and there are fears insurgents are about to intensify still further their assaults on Iraq's fledgling security forces, the interim government and U.S. troops.

(END VIDEOTAPE)

DOBBS: Brent Sadler reporting tonight from Baghdad.

Turning now to this country and the presidential campaign, President Bush and Senator Kerry today launching an all-out effort to win critical battleground states in the final 19 days of this campaign. Both candidates hope to build on the momentum of last night's debates.

Dana Bash covering the president's campaign in Reno, Nevada tonight. Candy Crowley with the Kerry campaign tonight in Des Moines, Ohio.

We go to you, Dana, first -- Dana.

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, in the president's case, what he needs to now do is regain momentum, momentum that even his campaign chairman today said that they actually did lose during the debates.

Now, to that end, the president today was his own post-debate spinner, and he actually did something that he almost never does, he's only done really a handful of times, and that is he went back on his plane, on Air Force One, to talk to reporters and to say that he thinks that he did a very good job in the debate.

He's glad that they were -- that -- he said that they went well, and he feels good about his candidacy, and he dismissed the polls and some of the punditry that say that he lost the debates 0 to 3.

Now, on the stump, in these two stops, first earlier today in Las Vegas and just now in Reno, the president reprised some of the things that we heard from him last night during the debate, issues that his campaign thinks are winning ones, particularly honing in on Senator Kerry and calling him a big government liberal.

(BEGIN VIDEO CLIP)

BUSH: He voted against the ban on the brutal practice of partial-birth abortion. He calls himself the candidate of conservative values, but he described the Reagan years as a time of moral darkness. There is a mainstream in American politics, and my opponent sits on the left bank. He can run, but he cannot hide.

(END VIDEO CLIP)

BASH: And the president picked up on some other themes from last night, like health care, again saying Senator Kerry's plan is simply too expensive; on Social Security, accusing the senator of not having a plan to fix the problems with that program.

Now, Lou, the question is: Where do the president and his campaign go from here? How do they spend his precious time and money? That is something that they are going to have to decide very soon, whether or not they continue to compete in the traditionally Democratic states.

And, if you want to look at perhaps a hint of that strategy, they announced today that the president will be going to New Jersey on Monday. That's a state that has looked solidly for Kerry, but the president has been shown to be gaining ground there recently. So he's going to go visit there on Monday.

DOBBS: And, Dana, what is the mood of the crowds where President Bush appears? Is he being received warmly, coolly, or what is the reaction?

BASH: Very warmly. He's had large crowds today, and it's very obvious what -- to look at what his aides certainly admit privately, that he is very comfortable on the stump.

He's much more comfortable on the stomp than when he was in debates, and, while they knew the debates were important because of their massive audiences, they knew it was also really good for him to get back out and get in front of the crowds because this is where he really shines.

So this is something that they're happy about, and, certainly, the crowds did seem happy. The Republican base here -- earlier, they were not very happy with the performance from the president, but, certainly, they seemed to be a little bit roused today.

DOBBS: Dana, thank you.

Dana Bash.

Senator Kerry today said it's time to seize the moment and to vote for a president who will honor middle-class values in this country.

Candy Crowley joins me now from Des Moines Ohio -- Candy.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Lou, Las Vegas seemed a very good place for John Kerry to start his post-debate round in this match. He went before the AARP saying that when George Bush says you can run, but you can't hide, he is quoting a boxer.

Now that put John Kerry in mind of another boxer, Muhammad Ali, who, when he was being punched again and again by George Foreman, looked -- Ali looked at him, and said "Is that all you got, George?" Look for this theme to come up in the days ahead.

(BEGIN VIDEO CLIP)

SEN. JOHN K. KERRY (D-MA), PRESIDENTIAL CANDIDATE: And so I say to you, Mr. President, after four years of lost jobs, after four years of families losing health coverage, after four years of falling incomes, is that all you've got?

After four years of rising gas prices, rising health-care costs and squeezed families, is that all you've got? After a campaign filled with excuses to justify your record and a campaign of false attacks on me, is that all you've got?

(END VIDEO CLIP)

CROWLEY: Now, like the Bush campaign, the Kerry campaign will be plotting over these next days, hour by hour sometimes, where they're going to put the candidate, where they're going to be putting his resources.

But one thing, Lou, will remain very steady, and that is John Kerry's target. It is directly at the middle class, at those independent voters and the swing voters. He is very certain of his base. He's now reaching in to the middle -- Lou.

DOBBS: Candy, I have to confess, as both you and Dana were reporting, I can't imagine that these campaigns haven't already figured out the itinerary for the next week or two. But, be that as it may, let me ask you the same question I asked Dana. How are -- what is the mood of the crowds receiving Senator Kerry? CROWLEY: The crowds have been -- certainly pre-debate, have been very, very good. Look, this was a very unusual election season beginning with the primaries, where we saw huge crowds for Howard Dean and then, as John Kerry began to gather, huge crowds.

There is a very passionate part of the Democratic Party that is turning out in force. Obviously, the trick is going to be to get them to turn out in force on Election Day, but the crowds are very revved up.

DOBBS: Candy Crowley, thank you very much.

One comment that Senator Kerry made during last night's so-called debate sparked outrage today and controversy. When asked if homosexuality is a choice, Senator Kerry responded by saying that Vice President Cheney's daughter, Mary, who is a lesbian, would probably say she was born gay. The Vice President and Mrs. Cheney today had a strong reaction to that remark by Senator Kerry.

Brian Todd reports.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): For someone who tries to stay in the background, Mary Cheney can't escape. With no provocation from her, the Democrats have made the vice president's openly-gay daughter an issue, especially in the last two debates.

KERRY: I think if you were to talk to Dick Cheney's daughter, who is a lesbian, she would tell you that she's being who she was. She was being who she was born as.

TODD: That was John Kerry's answer to the question, "Do you believe homosexuality is a choice?"

Here's the Cheney family's answer to John Kerry.

RICHARD CHENEY, VICE PRESIDENT OF THE UNITED STATES: Senator Kerry was out of line to even bring my daughter into it. I thought that was totally inappropriate, and, frankly, I was surprised that he would do something like that.

LYNNE CHENEY, VICE PRESIDENT CHENEY'S WIFE: This is not a good man, and, of course, I am speaking as a mom -- and a pretty indignant mom. This is not a good man. What a cheap and tawdry political trick.

TODD: Kerry issued a statement saying he was only trying to say something positive about the way strong families deal with the issue. But in the vice presidential debate a week earlier, Cheney had answered a question about the issue of gay marriage. Asked to respond, Senator John Edwards threw this out.

SEN. JOHN EDWARDS (D-NC), VICE PRESIDENTIAL CANDIDATE: You can't have anything but respect for the fact that they're willing to talk about the fact that they have a gay daughter. (END VIDEOTAPE)

TODD: Now an official with the Bush-Cheney campaign told me those comments by Kerry and Edwards were, in his words, "gratuitous." A Kerry campaign official told us their candidates have said nothing the Cheney family hasn't raised publicly before -- Lou.

DOBBS: Thank you very much.

Still ahead here, more on tonight's assault on Fallujah. General David Grange will join me. Dramatic new concerns that terrorists could be able to smuggle weapons of mass destruction into this country. We'll have a special report.

And new details tonight about the legal battle and the P.R. battle between Fox News host Bill O'Reilly and one of his female staff. All of that and a great deal more still ahead here.

(COMMERCIAL BREAK)

DOBBS: American and Iraqi troops tonight are advancing toward Fallujah. American aircraft are bombarding suspected insurgent positions within the city. U.S. aircraft have launched almost daily strikes against suspected insurgents' positions in Fallujah now for several weeks. It is obviously picking in intensity tonight.

Back in April, U.S. Marines launched an offensive against Fallujah and killed hundreds of insurgents, but the Marines withdraw when Iraqi officials negotiated what they thought was a truce.

Joining me now from Chicago, General David Grange.

General, this appears to be -- I understand -- and it's the -- the initial reports are somewhat fragmentary, but at least two battalions, believed to be all Marines, are advancing. What do you make of today's activities?

BRIG. GEN. DAVID GRANGE (RET.), CNN MILITARY ANALYST: Well, Lou, I don't think it's an all-out offensive. It's either a foothold for continued operations in the near future, or it's to take advantage of good intelligence they just obtained on some terrorist targets where they can do some terrific damage on the enemy at this time. But it's also tied into other operations throughout Iraq.

DOBBS: And those operations obviously stepping up in intensity, Ramadi being taken. Is it your expectation that we will see Fallujah under full assault by U.S. and Iraqi forces soon?

GRANGE: I think so. I think the elections right now -- and though a lot of people say this is hard to believe, but I think that these objectives are being taken down when the coalition and Iraqi forces are ready to do so, not tied to the election -- U.S. election. They're going to be done prior to the Iraqi election.

DOBBS: That's what I would ask you next, is there have been -- you know, the pundits speculating that there would be no major offensive actions taken until after the election. It looks like this is certainly the beginning of one that is at least significant, if not major, and don't ask me to define the distinction.

But the fact is there's been a lot of waiting here to take this action if they want to take it. Why in the world are they moving in battalion strength, rather than moving up in full brigades, deciding to decisively render the insurgents helpless here?

GRANGE: Well, there's probably some other movement of forces around Fallujah that's not being reported. What's being reported is this particular foothold, and a foothold and a fight in the city is critical to launch the further attack.

What's key here is that a lot of the residents of Fallujah are actually getting tired of the foreign fighters in the city. There's some still that are going to fight against the coalition and the Iraqi government, but some are tired of it and they think that -- and they see on the horizon that this city's going to be taken down, just like Samarra and Ramadi and Buqaba and others, and so they're preparing for the victors, I think, and it's -- and they realize it will be done.

DOBBS: General David Grange, as always, thank you.

GRANGE: My pleasure.

DOBBS: Coming up next here, gaping holes in security to our nation's ports. A troubling new report out tonight.

(BEGIN VIDEO CLIP)

REP. JIM TURNER (D), TEXAS: We are not as well prepared as we need to be to prevent a nuclear bomb or a nuclear device from being shipped into our country.

(END VIDEO CLIP)

DOBBS: We'll have that disturbing special report for you next.

Also ahead, this country falls even deeper into debt. Debt and deficits mounting at a staggering rate, a record rate. We'll have that report.

And later, Fox News host Bill O'Reilly putting his career, his reputation on the line, fighting a sexual harassment charge. We'll have the story of the legal and public relations battle.

We'll take a look at your thoughts.

And a great deal more still ahead here.

(COMMERCIAL BREAK)

DOBBS: A disturbing report tonight about what are straightforwardly gaping holes in security at this nation's ports. An independent investigator for the Department of Homeland Security has found that current measures to secure our ports simply are not sufficient. There are rising concerns that terrorists might well be able to smuggle weapons of mass destruction into this country.

Casey Wian reports from Los Angeles.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): On September 11, 2002, ABC News reported its smuggled 15 pounds of depleted uranium from Istanbul, Turkey, to New York on a cargo ship. A year later, the network reported it concealed a similar shipment of non-weapons-grade uranium from Jakarta, Indonesia, to Los Angeles.

The incidents exposed flaws in the nation's port security and prompted lawmakers to demand an investigation by the Department of Homeland Security's inspector general. The results were made public today.

TURNER: The inspector general's reports very troubling. We can see that we are not as well prepared as we need to be to prevent a nuclear bomb or a nuclear device from being shipped into our country. But, frankly, it's inexcusable, three years after 9/11, that we still have not installed enough radiation portal detectors.

WIAN: Turner and other congressional Democrats blame the Bush administration for a shortage of port security funding, including money for radiation detectors at every U.S. port. During Wednesday's debate, Senator Kerry also blamed President Bush, saying 95 percent of shipping containers entering the United States are not inspected.

That's technically true. However, every container's manifest is inspected, and those deemed high risk are opened and checked. The inspector general's report says improvements have been made, including more sensitive radiation detection equipment and better search procedures and training.

CLARK KENT ERVIN, DHS INSPECTOR GENERAL: The good news is there is a layered system in place to protect our ports. But, of course, the overall system is only as good as each layer, and so we are intensively conducting inspections and audits to test each layer.

WIAN: Customs and Border Protection inspectors and the Coast Guard are inspecting more cargo and boarding more ships than ever. Ports have also tightened security procedures. But resources are stretched thin. The Bush administration requested $46 million for port security grants in this fiscal year's budget. Congress more than tripled that to $150 million.

(END VIDEOTAPE)

WIAN: The American Association of Port Authorities requested $400 million and said that wasn't even enough to do the entire job, and that doesn't even include the billion dollars a year the Coast Guard says it needs to upgrade its fleet and add more manpower -- Lou.

DOBBS: Casey, any indication from the Department of Homeland Security -- now that there is a report stipulating and concluding, validating what we already knew, is there any plan to change all of this, to shore up our security in our nation's ports?

WIAN: The department says it is adhering to the inspector general's recommendations, which he would not disclose because they're secret, they don't want to give anything away it terrorists, but they say they are taking those recommendations to heart.

They are doing things like running checks, testing out the port screening facilities, the same way they did with the aircraft screening facilities, trying to sneak mock weapons through to make sure that there are no more big holes in the system -- Lou.

DOBBS: Casey, thank you very much.

Casey Wian reporting live from Los Angeles.

Still ahead here, the presidential candidates return to the campaign trail. The final push to November 2 is underway. I'll be joined by former presidential adviser David Gergen.

And Driven to Run. An American so disgusted with lack of a national immigration policy and complete failure at our nation's borders, he's running for Congress.

(BEGIN VIDEO CLIP)

CHRIS KOBACH, RUNNING FOR CONGRESS: So many people avoid immigration in politics. They think it's the third rail of politics just like Social Security. You don't want to talk about it. But I think we need to talk about it.

(END VIDEO CLIP)

DOBBS: And talk about it, we will. We'll have the story of Chris Kobach.

And Fox News host Bill O'Reilly ready for the fight of his life as he faces shocking charges. We'll have the story and a great deal more still ahead here.

(COMMERCIAL BREAK)

ANNOUNCER: LOU DOBBS TONIGHT continues. Here now for more news, debate and opinion, Lou Dobbs.

DOBBS: It's not given much attention, but, in point of fact, this country's debt continues to mount to dangerously high levels, levels that will eventually threaten the stability of our economy. The United States' massive trade deficit surging to $54 billion in the month of August. That is the second highest level in history, and the national debt rising as well at a staggering rate.

Lisa Sylvester has the report from Washington.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Barbara Anderson does not like personal debt, and she doesn't like it when the U.S. government continues to rack up a growing national debt.

BARBARA ANDERSON, GRANDMOTHER: Either my grandchildren aren't going to be getting the services that we all get comfortably, or they're going to have to pay taxes that are way beyond their ability to sustain. So it's not fair to them. They don't have a vote this year.

SYLVESTER: Treasury Secretary John Snow says it's imperative Congress raise the government $7.4 trillion debt sealing when lawmakers return in mid-November to meet the government's obligations.

Congress has already raised the debt ceiling twice during the Bush administration, shattering all previous records. In 2002, the debt ceiling was $5.95 trillion; 2003, $6.4 trillion. Today, it's $7.4 trillion. The growing debt is fueled by a record-setting budget deficit this fiscal year, more than $412 billion. Fiscal conservatives say programs like the prescription drug benefit will only make it worse.

TIM KANE, HERITAGE FOUNDATION: It's almost hilarious to think of the shift where the Republicans used to be the budget hawks. Now the Democrats are pretending to be budget hawks. So we don't really see the discipline in either party.

SYLVESTER: But the budget deficit is not the only concern. Economists are also worried about a growing trade deficit. The U.S. trade deficit, the difference between what the United States buys overseas and what it sells abroad, has been steadily increasing. August 2003, the monthly trade deficit was $40 billion. In August 2004, the trade deficit jumped to $54 billion.

As Americans have stopped buying U.S. goods and services, jobs have been lost, 600,000 in the last four years.

RANDALL DODD, FINANCIAL POLICY FORUM: If we continue along the pace we are now, it's unsustainable and there will have to be some day of reckoning.

(END VIDEOTAPE)

SYLVESTER: At the current debt ceiling of $7.4 trillion that breaks down to $25,000 worth of national debt for every man, woman and child in the country. And that figure is searching to increase depending on how much the national debt ceiling is raise said -- Lou.

DOBBS: Lisa, thank you, for those -- well there just simply -- just stunning statistics, that -- terrific report. Thank you very much. Lisa Sylvester from Washington.

Returning to the presidential race now. My guest says last night's so-called debate was a must-win for President Bush. But according to the CNN/"USA Today"/Gallup poll last night, most of those surveyed said Senator Kerry won.

Joining me now is David Gergen, former adviser to four American presidents. Good to have you here, David. DAVID GERGEN, FMR. PRESIDENTIAL ADVISER: Thank you, Lou.

DOBBS: Now, you had said it was a must-win for the president. Did he win?

GERGEN: No. I thought personally that it was more of a draw. Maybe a slight Kerry win. But we have three polls out, especially the CNN poll. Two out of the three say it was a big win for Kerry, the other say it was basically a tie. The public perception is going to be two weeks from now that Kerry won this debate. It doesn't make a difference what I think. What makes a difference is what the public thinks. And I think it's come across now for three wins for John Kerry and that's unprecedented.

DOBBS: You are the expert.

GERGEN: Well, I'm not sure.

DOBBS: Issues of trade, of immigration, domestic policy, broadly national security. I have to say, did you find the contrasts, and I have been reading nearly everything written by the best folks in the national media, did you really find as many distinctions between these two, differences between these two as everyone else on those principle issues?

GERGEN: I think there are differences in philosophy that are pretty clear and pretty strong. I do think George Bush is more of a traditional conservative, even radical conservative on some issues and John Kerry is a more traditional liberal but what I do find is common between them is they both have plans that don't add up financially. If you -- harsh realities are going to set in after this election. And when we've got a national deficit that's going to increase some $2.3 trillion over the next 10 years, national debt will go up $2.3 trillion. Each one of these candidates has a plan that costs at least $1 trillion. And some people think...

DOBBS: Everybody should hear David Gergen say that one more time.

Each of these candidates...

GERGEN: Each of these candidates has a plan that costs at least $1 trillion. Many experts think the Kerry plan is 1 to 2, if you include social security. With President Bush, it is 1 to 3 for President Bush. You cannot -- you cannot pass a plan from 1 to 2 to 3 trillion, have all of this debt mounting up and still cut the deficit in half. It just can't be done and the numbers don't add up. So, there's going to have to be a lot of compromising. The one thing I will say on behalf of John Kerry, which I fortunately can't bestow the president right now, at least he said, my plans are subject to the physical conditions of the country. I will not try to pass them unless we are getting the deficit down. That's a healthy start.

DOBBS: Well, that's an interesting point. Because adversely, then, why not those concerns and conditions and qualification apply and in prevent him from doing as he previously did, saying -- looking into the camera and say, I will not raise taxes?

GERGEN: I thought that was a terrible mistake.

DOBBS: Well, it's inconsistent.

GERGEN: It's inconsistent -- it is inconsistent and also as we found out in the previous President Bush, 41, there are conditions under which you do need to raise taxes. And when we face up to the needs of social security, it may be that you have to raise the cap, on how much of your income is subject to the payroll tax.

DOBBS: Let's talk about a couple of other issues, too, first immigration. I thought both men sort of stamped themselves as cautious to the point of...

GERGEN: Incomprehensible?

DOBBS: Yes. When the nation is absolutely united on the issue, border security, border control, immigration. And neither one of these men have the capacity or apparently the character to say, clearly what their policy would be.

GERGEN: Well, I think they suggested they be tougher, but I don't see clear-cut policy. I agree with you on that. And the -- the country's going to have to face up to this. Look, what's happening here, what's underlying this is the president got 34 percent of the Hispanic vote last time and wants to get up to 40. And that he may -- he thinks that holds the key of two three states like Florida, like maybe even New Jersey.

DOBBS: Are both of these candidates just taking middle hear class America, working men and women in this country with their families, are they just take them it for granted as abject fools...

GERGEN: No, I think that's too much. I do think that they are -- I don't think that the plans ad up. I do think -- they have -- look, how should one say this? We've had a lot of candidates who've run with plans that don't added up. We've seen that in the past.

DOBBS: It's not the first time.

GERGEN: It's not the first time. But what it leads to is disillusionment. Vote for somebody and they think they are going to get X and get Y. And it's a bate and switch, which is not a healthy situation. I think do that John Kerry is much better shape coming out of these debates. I think these -- I think the debates have transformed this politically, but I don't think the plans ad up on either side.

DOBBS: We are out of time. So am I -- are we to infer then that David Gergen believes Senator Kerry will be elected president?

GERGEN: I thought before the debate started that George Bush was going this election. I now think the odds have shifted slightly toward Kerry but it's still -- Bush can still win this. We've still got three weeks. But I do think the odds now favor John Kerry for the first time.

DOBBS: David Gergen, as always, good to have you here.

That brings us to the subject of our "Poll Tonight." The question is do you believe candidate's performances in the debates will determined the outcome of the election, yes or no?

Cast your vote a cnn.com/lou. We'll have the results, as always, later.

A reminder, tonight on "PAULA ZAHN NOW," a town hall meeting tonight live from Bucks County, Pennsylvania, an important battleground state.

Joining me now to tell us, who better, Paula Zahn herself -- Paula.

PAULA ZAHN, HOST "PAULA ZAHN NOW": Hi, Lou. It looks like a Hollywood set, doesn't it?

Well, it isn't. I am joining you from rural Pennsylvania right now. Bucks County is two-thirds the way between New York City and Philadelphia. And not only is it farm country, it is our gathering place tonight, this barn that has been standing here since the 1850s. And about 125 voters will be joining me, and even though there have been three Bush/Kerry debates, roughly 1 in 5 of tonight's audience is still undecided. And they will have a chance to put questions to Kiki McLean of the Kerry campaign and Liz Cheney, one of the vice president's daughters.

DOBBS: What are the issues you're going to focus on tonight?

ZAHN: Well, you can imagine terrorism will be at the top of the list. This is an area that really took a lot of hits on September 11th. Even though we are talking about rural Pennsylvania, more than a dozen people lost their lives on September 11th. I am sure the economy will be a huge issue, as it is in the rest of Pennsylvania. And I was struck by something, your previous guest, David Gergen had to say about how tight this election here is. Prior to the debate, we know that it was a dead heat here in Pennsylvania. And that's the reason why we have seen the president come here, at least about, we're told 33 times. And John Kerry over a couple of dozen times. The stakes are very high and I think you'll get a sense of how volatile the electorate is when you meet some these folks tonight.

DOBBS: Paula Zahn, thank you very much. Paula Zahn's town meeting, beginning 8:00 Eastern here on CNN tonight.

More details tonight of legal wrangling between Fox News host Bill O'Reilly and one of his female employees. Andrea Mackris, has accused O'Reilly of sexual harassment, but O'Reilly says that accusation is nothing less than extortion and politically motivated.

Jason Carroll reports.

(BEGIN VIDEOTAPE) JASON CARROLL, CNN CORRESPONDENT (voice-over): Bill O'Reilly on the talk show circuit, promoting his children's book. Not an easy task when you are involved in a sexual harassment lawsuit and having what O'Reilly calls the worst day of your life.

BILL O'REILLY, HOST "O'REILLY FACTOR": If I have to go down, I'm willing to do it. But I got make a stand.

CARROLL: Making a stand against one of his associate producers. Andrea Mackris, who alleges he sexually harassed her by make repeatedly sexually explicit remarks.

ANDREA MACKRIS, FOX NEWS ASSOCIATE PRODUCER: Mainly the last time that I had spoken to Bill, and when this inappropriate conversation had happened the last time. He said it was going to be in person, and I was -- I felt extremely threatened for many reasons.

CARROLL: Her complaint alleges that in one phone conversation, O'Reilly fantasize fantasized he would basically be in the shower. I would take that little loofa thing and kind of soap up your back. The rest, too graphic to air. The language in the complaint is very specific but Mackris' attorney wouldn't confirm if there was a recording. O'Reilly lawyers say, "none of the action rise to level of unlawful activity." And they say, Mackris' complaint was part a $60 million extortion content. They filed their own suit against Mackris and her attorneys.

O'REILLY: This is the single most evil thing I have ever experienced. And I've seen a lot.

CARROLL: O'Reilly's legal teams say she never complained to Fox Human Resources about the alleged behavior. Mackris worked at Fox for four years. She left last January for a brief producing stint at CNN, but returned to the "O'Reilly Factor" on July, on condition of the complaint says, he no longer engaged in inappropriate conduct. But Mackris says the conduct resumed, even though she wrote in an e-mail she was, surround by really good fun people.

LESTER HOLT, MSNBC CORRESPONDENT: Did you write that?

MACKRIS: Yes, I did.

HOLT: And how do you account for that?

MACKRIS: I loved my job. I never wanted this to happen.

CARROLL: What ultimately will this mean for O'Reilly's job, and image?

He's not just a popular anchor, but an author and family man.

RONN TOROSSIAN, SW PUBLIC RELATIONS: O'Reilly is a hard-core conservative who likes to talk about himself as the king of no spin. Mr. O'Reilly, keep spinning. Keep spinning and keep fighting.

(END VIDEOTAPE) CARROLL: O'Reilly says Mackris' lawsuit is politically motivated. Saying her attorney's firm made contributions to the Democratic Party. Mackris' attorney says the extortion complaint is without merit. And his client's complaint is not political, it's sexual harassment and the allegations against O'Reilly will be proven in court -- Lou.

DOBBS: Very high-stakes conflict between these two. Jason, what is the next step here?

CARROLL: Well, sometime in late October, October 22, both of the sides will get together and if there is an issue about the tapes, perhaps at that time, that issue will be resolved.

DOBBS: Thank you very much, Jason Carroll.

Still ahead, "Driven To Run." Tonight, how one man from Kansas is challenging the federal government to protect this country from what has become an invasion of illegal aliens. His political fight could take him all the way to Washington, D.C.

And sprint to the finish. How the presidential candidates are spending their final days on the campaign trail. Three of the nation's top political journalists joining me next.

(COMMERCIAL BREAK)

DOBBS: Now, "Driven To Run," our series of special reports this week on ordinary Americans who are challenging our political system. Tonight, we introduce you to a congressional candidate in Kansas, who's campaigning for tighter border security. He wants 20,000 National Guard troops deployed to protect our borders. Peter Viles has this story from Overland Park, Kansas.

(BEGIN VIDEOTAPE)

PETER VILES, CNN CORRESPONDENT (voice-over): He's athletic, a family man, has degrees from Harvard, Yale, and Oxford, teaches constitutional law, even drives a pick-up truck. In short, Kris Kobach is a political consultant's dream candidate, except for one thing.

KRIS KOBACH (R), KANSAS CONGRESSIONAL CANDIDATE: I think we now need to put troops on the border.

VILES: Unlike so many politicians, Kobach wants to talk about America's border crisis.

KOBACH (voice-over): In Congress, I'll fight for secure borders. To protect my family and yours.

VILES: Even at the Republican convention, where broken borders was off limits as a topic.

KOBACH: I'll close the door to terrorists who abuse America's open borders. VILES: It's not like he has to do this. The third district of Kansas is a thousand miles from the Mexican border.

KOBACH: I'm willing to take a stand. So many people avoid immigration in politics. They think it is the third rail politics, just like Social Security, you don't want to talk about it, but I think we need to talk about it.

VILES: Kobach served in the Bush White House. As an aide to Attorney General John Ashcroft, he helped to write the policy that forces foreign visitors to register with the federal government. But now he believes the government must do more to secure the borders. His agenda? No in-state college tuition rates for the children of illegal aliens. Use local law enforcement to enforce immigration laws, and use the National Guard to patrol the borders.

In what is shaping up as a tight race, Kobach's opponent, Democratic incumbent Dennis Moore disagrees on all three issues saying the Guard is stretched too thin for new duties.

DENNIS MOORE (D), KANSAS STATE HOUSE: President Bush is against that, Secretary of Homeland Security Tom Ridge is against that. It's a bad idea. Mr. Kobach thinks it's good idea and he thinks he knows better than the president, the secretary of -- the director of homeland security. I just think he's wrong.

VILES: Whether he wins or loses in November, Chris Kobach did something here Kansas this fall, that both presidential candidates thought was too risky to do. He opened a debate about border security and immigration. Peter Viles, CNN, Overland Park, Kansas.

(END VIDEOTAPE)

DOBBS: Taking a look now at some of your thoughts. Many of you writing in about our special report last night on the millions of dollars the U.S. government is investing in Mexico's health care.

Carl in Pickens, South Carolina. "Lou, with so many people in the United States out of work, without health care, this donation for health care in Mexico is just another slap in the face to American workers.

Barbara Anderson in Raleigh, North Carolina. "Lou, instead of using U.S. taxpayer money to provide health care to Mexican citizens we should be using that money to secure our borders."

Send us your thoughts at loudobbs@CNN.com. Please include your name and address. Each of your whose e-mail is read on this broadcast, receives a free copy my new book "Exporting America."

Coming up next, less than three weeks now to election day. The election's still close to call. I'll be talking with three of the country's most prominent political journalists next. Stay with us.

(COMMERCIAL BREAK) DOBBS: Now, our political panel from Washington tonight. Ron Brownstein, national political correspondent, "L.A. Times," Michael Weisskopf, senior correspondent, "TIME" magazine and with me here in New York Mark Warren, executive editor, "Esquire" magazine. Mark, let me turn to you first, and let's get this out of the way, who won the debate?

MARK WARREN, "ESQUIRE" MAGAZINE: It was certainly the president's most poised and confident performance but Senator Kerry won the debate and I think he won in the larger sense as well, in that it was just two weeks ago that he (UNINTELLIGIBLE) to remind us that he was still running for president and these debates transformed this campaign and he's now in the position to possibly win the election.

DOBBS: Do you agree, Michael?

MICHAEL WEISSKOPF, "TIME" MAGAZINE: Well, if you are using the undecided voter as a real test, probably Kerry transcended more to them. The president was very strong with his base, and with some of his comments certainly gave him plenty of reason to get to the polls. But in the end, if the base is turned out, it's going to be that very small number of undecided voters that's going to make the difference.

DOBBS: Ron, do you give a clear win to one or the other of the candidates?

RON BROWNSTEIN, "LOS ANGELES TIMES": Not last night, Lou. I thought overall, I thought Senator Kerry was slightly better than President Bush. I thought it was the least energetic of the three debates. President Bush came out early intending to define Senator Kerry as I liberal. Continuing the line of attack he's had on the campaign trail. But he kind of lost momentum on it, even seemed to lose interest on it.

Spent the second half of the debate trying to refurbish his credentials as a passionate conservative, talking about tolerance and understanding repeatedly on various subjects. In the end, I'm not sure did that much change the dynamic and as a result I agree with everyone else. John Kerry went into these debates trailing by six, seven, eight points. Comes out even or even slightly ahead with President Bush's vote back under 50. A slight, slight tilt in his direction after these debates.

DOBBS: Michael, is this now Senator Kerry's election to lose?

WEISSKOPF: Well, three weeks left, Lou, lots of time to make mistakes. Lots of time to motivate the base, and to get the get-out- the-vote forces in line. In the end, this is going to be a game that's on the ground. Who is better in getting their voters to the polls?

And I would say that it really is a toss-up at this point.

DOBBS: Mark, the fact is, that as we look at these state-by- state poll, despite the national poll, dead heat or slight advantage at this point now to Senator Kerry, the electoral votes still favor President Bush significantly.

WARREN: I think that is right. Even though Senator Kerry did reverse trends in the swing states, significantly in the last two weeks making himself more competitive. But I think you are right. And the incumbent always has crushing advantages, but if there is slight as it may be, Senator Kerry may have a bit of momentum that he certainly did not have two weeks ago.

DOBBS: Ron, your thoughts?

BROWNSTEIN: Well, they're kind of mixed signals on that, Lou. Our sister paper, "The Chicago Tribune" polled just the -- yesterday I believe it came out, and the four most hotly-contested western battleground states and they had Senator Kerry back ahead in Wisconsin, ahead in Ohio, ahead in Minnesota and trailing slightly in Iowa.

I think that what we've got here, I agree with Michael, I mean, we really have two big uncertainties here in the last three weeks. One is events and we have seen this election is very sensitive to events, especially in Iraq. The other is the ground game and how many people come out and vote. One of the problem for all of these polls if the turnout is a lot higher than, you know, know that the polls are generally anticipating. It's possible that could benefit either side. All of the indications are, a lot of people are going to come out and vote and that could add uncertainty in these final weeks.

DOBBS: All of that taken, is there any indication, Michael, anywhere, that seeing one party or another gain an advantage in registration at this point.

WEISSKOPF: Different state, Lou, have emphasized different parties, and depending on how aggressive each candidate and his forces were in state, they thought they had the best shot of winning. And I guess the Democrats have shown a small advantage in terms of registering people. Whether or not those people show up to the polls is another matter.

DOBBS: And the issue of the integrity of voting? I mean, we have been reporting here particular over the last several weeks of instance after instance of irregularities if not outright fraud.

Is this going to define this election, Ron?

BROWNSTEIN: Well, I think unfortunately, Lou, it might. We are living in an era in -- 2000, a voting supervisor in Florida said to me, the margin of victory in election was smaller than the margin of error. The reality is the election system, like any other system designed by human hands is going to have some element of imperfection. And because the country is so closely divide, that is imperfection is enormously magnified. It will be matter if the overall electoral college is very close and if individual states are very close.

Now, we seem to be on track of that. Perhaps one candidate will widen to the point where some of these issues wont be as significant, because their margins will be bigger. But if we stay in the direction we are in, I think we're going to have a lot of arguments unfortunately again. And quick point, the post-election fight, the battle beyond election day now seems to be accepted as part of the rules of engagement as in so many other areas. We're widening the battlefield.

DOBBS: Reports to day, Mark that the DNC was telling its people to claim voter intimidation, whether there's voter intimidation or not. These kind of ground rules that we can expect.

WARREN: It's preposterous, if that's in fact true. I know that they were mischaracterized in that report. But, yes, I think so. After what happened four years ago, I think they are all prepared to play dirty, post-election.

DOBBS: Do you, gentlemen, agree?

BROWNSTEIN: Well, yes, look. I do think that, basically, again, because it is so close, everything matters, Lou. Every possible advantage. I mean, we've seen in this in many fronts in this campaign from the amount of spending by the 527s, to the ground game that we've talked about. And I think this is just going to be another element of what I would call the widening and the extending of this presidential battlefield. I do suspect that both parties are mobilizing armies of lawyers already. When you have that many lawyers around, they are going to do something.

DOBBS: Michael, your thoughts?

WEISSKOPF: The independent groups, Lou, are the joker in this whole deck. And they've got the money at this point, and they are kind of shadow parties. What they do with that money in terms of last-minute advertisements and what they do in terms of getting people to the polls is going to be a big difference.

DOBBS: Michael Weisskopf, Ron, thank you very much, Mark, thank you very much for being here. We look forward to the days ahead. I know you do, too.

Still ahead here, the results of "Tonight's Poll." We'll have a preview of what's ahead tomorrow.

(COMMERCIAL BREAK)

DOBBS: The results now of our poll. Seventy-five percent of you say the candidates performance in the debates will determine the outcome of this elections, 25 percent of you say it will not.

Thanks for voting and thanks for being with us tonight. Please join us tomorrow, "Democracy at Risk." K. Maxwell, the president of the League of Women Voters concerned about the integrity of our voting system. She'll be my guest.

And "Driven to Run," we'll introduce you to a former teacher so frustrated with the state of public education, he's running for Congress. We'll have his story. And in "Heroes," the remarkable story of an army medic who volunteered to serve this country in Iraq. We'll have his story of courage.

For all 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


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