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Lou Dobbs Tonight

Kofi Annan Implicated?; Fighting the Insurgency; Lost its Way?; Aruba Search Continues; Canada Trade; Confrontation with Iran?

Aired June 14, 2005 - 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: Good evening, everybody. Tonight, no less than four deadly attacks sweeping across Iraq. At least 30 people were killed, including an American soldier. The enduring violence is causing some now to demand answers about when the United States forces will leave Iraq.
Tonight, a new book accusing another member of President Bush's axis of evil, Iran, of harboring Osama bin Laden. The author of that book says the United States is on the verge of a nuclear showdown with Iran. He is among our guests here tonight.

And Microsoft working with the Chinese government to block freedom in China. How Microsoft and other American companies are censoring their Chinese customers who would otherwise want to talk about democracy. We'll have that special report.

But first, alarming new questions tonight about the role of U.N. Secretary-General Kofi Annan in the oil-for-food program scandal. A newly discovered memorandum appears to contradict repeated denials from both the secretary-general and his son about the roles they played in awarding a multimillion-dollar oil-for-food contract. An internal memo from the company that won that contract, Cotecna, now raises questions not only about those denials, but about the secretary-general's future as head of the United Nations.

Richard Roth reports.

(BEGIN VIDEOTAPE)

RICHARD ROTH, CNN SR. UNITED NATIONS CORRESPONDENT (voice-over): The scandal will plague Kofi Annan until the end of his term as secretary-general.

KOFI ANNAN, U.N. SECRETARY-GENERAL: For some, the oil-for-food crisis will never die down.

ROTH: The problem for Annan is that things keep popping up. The latest, a new portion of an e-mail which at the very least, raises questions again regarding a link between Annan and the awarding of a contract to Cotecna, the Swiss-based company paid $10 million a year to inspect humanitarian goods entering Iraq, the same company that once employed Annan's son Kojo.

Earlier this year, the U.N. authorized oil-for-food investigator, Paul Volcker, concluded he didn't have enough evidence to allege any corruption by Annan. Now, Cotecna has discovered an e-mail from a vice president, Michael Wilson, to company leaders in 1998. Wilson, part of the Cotecna team whose mission was to win the contract, wrote, "We had brief discussions with the secretary-general and his entourage, and we could count on their support."

The Volcker panel says it is now urgently reviewing the newly- turned-over documents and travel records handed over by the U.N. A spokesman said Annan was in Paris in 1998 where the memo alleges a meeting occurred, but that Annan was not involved in any Cotecna meeting and never even knew of the Cotecna interest in the contract.

FRED ECKHARD, U.N. SPOKESMAN: We spoke to the secretary-general, who's in Paris today, and he has no recollection of any such exchange. And the views attributed to him in this e-mail by Michael Wilson...

ROTH: A week after Wilson's e-mail, Cotecna won the oil-for-food contract. Its bid was the lowest.

(END VIDEOTAPE)

ROTH: Wilson is no longer with Cotecna, and the company told us today, Lou, that he exaggerates his own importance. Wilson is also known to call Kofi Annan "Uncle" based upon a close family relationship back in Ghana, where both come from. And Wilson is also a childhood friend of Kojo Annan, the secretary-general's son. The Volcker Commission has said that Kojo Annan has not been cooperating.

Lou.

DOBBS: Well, obviously Wilson has in some degree here the sudden emergence of these words by Wilson implicating, at least on their face, the U.N. secretary-general. Why the timing? How did it occur? Do we know?

ROTH: Cotecna says their new audit - quote -- accidentally discovered this. A portion of this e-mail was already in Volcker's hands. If you read the last Volcker report, there's extensive notes about Michael Wilson, and Michael Wilson maybe not remembering and then refreshing his memory.

It's just these new words have now been turned over by Cotecna. And certainly, when you see the Volcker panel say they are now urgently going to look at them, you have not seen that type of tone before, because, in effect, they cleared Annan on corruption, something that Annan says he was exonerated on. This puts things in a totally new light potentially.

DOBBS: Richard Roth, our senior U.N. correspondent. Thank you, Richard.

The Senate investigators also, of course, will be taking a careful look at these new emerging details.

Senate Republicans, meanwhile, are hoping to force a vote this week on President Bush's nominee to be United Nations ambassador, John Bolton. Senate Majority Leader Bill Frist and Senator John McCain today accused Democrats of obstructing Bolton's nomination and confirmation. Senator Frist said he will soon hold another procedural vote on Bolton's nomination, even though he concedes there might not be enough votes to force final confirmation. Democrats have demanded the White House release more records of Bolton's work at the State Department.

Bolton, for his part, has been accused of abusing his colleagues and misusing his access to classified information. Those accusations, of course, coming from the Democrats on the committee.

In Iraq today, an American soldier was killed when he was struck by a rocket-propelled grenade in Baghdad. The U.S. military also reporting two U.S. soldiers were killed yesterday in a bombing in Ramadi.

A new attack today at a critical Ramadi entry point killed an Iraqi soldier. Soon after that attack, the military says coalition forces opened fire on a car speeding toward the entry point. Five Iraqis were killed in that exchange.

In Kirkuk, at least 19 people were killed when a suicide bomber blew himself up outside a bank. Ninety people were wounded in the explosion. Iraqi officials say most of the dead and wounded were waiting to pick up their paychecks.

Near Baquba, insurgents coordinated a car bombing and a mortar attack on a police station. Five people were killed, including members of the Iraqi police and Iraqi army.

More than 1,700 of our troops have now been killed in Iraq over the past 28 months. These last 10 weeks have been among the deadliest for U.S. forces since the war began. The unending violence has renewed some calls for the United States to set a clear time frame for withdrawal from Iraq.

Kitty Pilgrim reports.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice-over): General George Casey, the top U.S. commander in Iraq, calls fighting the Iraqi insurgency the "Pillsbury Doughboy" idea. You push in one area, and attacks pop out in another. Top military officials today confirm the number of attacks is still running at some 50 to 60 a day.

GEN. PETER PACE, VICE CHAIRMAN, JOINT CHIEFS OF STAFF: But I would not chase the spikes and dips in the security situation. If you draw a straight line through the middle of that, it's fairly constant. That's not good or bad. It's fact.

PILGRIM: But analysts say April, May and June are all on track for the highest attack rates in the last year. The Bush administration recently trying to paint those statistics as a last gasp of the insurgency. RICHARD CHENEY, VICE PRESIDENT OF THE UNITED STATES: I think the level of activity that we see today from a military standpoint, I think, will clearly decline. I think they're in the last throes, if you will, of the insurgency.

PILGRIM: But some in Congress are criticizing, saying that spin doesn't match the reality on the ground. On ABC News this week, one previous supporter of the Iraqi operation said he is now calling for a timetable to withdraw.

REP. WALTER JONES (R), NORTH CAROLINA: I voted for the resolution to commit the troops, and I feel that we've done about as much as we can do.

PILGRIM: The president's spokesman saying there will be no schedule for troop withdrawal.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: The message that it sends to terrorists and others, is all you have to do is wait and we'll leave.

PILGRIM: The most recent Gallup poll finds 59 percent of people want to withdraw some or all troops from Iraq, one of the most negative readings on the war since it began in 2003.

(END VIDEOTAPE)

PILGRIM: Now, military officials are increasingly talking about the need for political solutions to complement the military effort. U.S. forces can help with the military training of Iraqi soldiers, but they admit that the political momentum has to come from the Iraqis themselves.

Lou.

DOBBS: Kitty, thank you very much.

Tonight, an unprecedented rebuke for a group that has been critical of the United States' role in Iraq, the International Committee of the Red Cross. And according to a group of Senate Republicans, the IRC has lost its way. A new Senate report says the ICRC is actively working against the interests of its largest donor, the United States.

Christine Romans reports.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): A powerful group of Republican senators says the International Committee of the Red Cross has lost its way. A 10-page white paper from the Republican Policy Committee charges the International Red Cross has abandoned its impartiality. "It has become more responsive to the preferences of the liberal and frequently anti-American international nongovernmental organization community." The ICRC has been critical of the U.S. treatment of prisoners at Guantanamo Bay, Cuba, and in Iraq. But the senators say the ICRC is unfairly accusing the U.S. of violating the Geneva Conventions and is interpreting international law to give terrorists the same rights as legitimate military personnel. Further, the white paper chastises the Red Cross for crusading against landmines, cluster bombs and tear gas outside of their mandate.

UNIDENTIFIED MALE: They are getting involved in wanting to develop new laws, and involved in advocacy. And there's -- they are getting away from their most basic core, humanitarian duties, and that's helping aid in a crisis situation to the many suffering people. So they have to be careful about -- about doing that.

ROMANS: The senators, led by Jon Kyl of Arizona, demand an investigation into whether U.S. taxpayer money is being used at cross- purposes with U.S. interests. The ICRC says it is reviewing the paper and will - quote -- "discuss the issues with those concerned bilaterally through our usual working channels. We are committed to working transparently and to the best of our capacity to fulfill our humanitarian mandate."

(END VIDEOTAPE)

ROMANS: Over the past 15 years, the United States has given $1.5 billion to this group, in large part because of the ICRC's history, saving American lives in two world wars, and for its humanitarian work around the world. Now the senators say for this, the group deserves praise and recognition. But the senators call its drift into activism very worrisome.

Lou.

DOBBS: And this is a process that some say has been accelerating over recent years. And the fact is that there is a desperate crying need to look into the role of nongovernmental organizations all around the world, even those like the ICRC, that have provided important humanitarian work, certainly.

Christine, thank you.

ROMANS: You're welcome.

DOBBS: Christine Romans.

Coming up next here, a desperate new search in Aruba. Officials have a tip now that could solve the mystery of missing Natalee Holloway.

Also tonight, a massive law and order breakdown just over the Rio Grande. U.S. officials say violence in Nuevo Laredo, Mexico, could spread across the border.

And, is Microsoft going soft on China? Critics say the high-tech giant has caved in to political pressure from Beijing and has ignored President Bush's focus on freedom and democracy. Those stories and more coming right up.

(COMMERCIAL BREAK)

DOBBS: New developments tonight in the search for Natalee Holloway, the teenager who disappeared in Aruba more than two weeks ago. Police tonight have cordoned off an area near a beach-front hotel in Aruba. An extensive search is now under way in the water and on land near the hotel.

Karl Penhaul joins us now live from Palm Beach, Aruba, with the latest. Karl.

KARL PENHAUL, CNN CORRESPONDENT: We can see that area on a live picture that we've got up now. It's about 500 yards long, and at its widest point about 150 yards wide. It's sandwiched between the main highway that leads around the coast and the beach area next to the Marriott hotel.

That's about a mile and a half from where I'm standing at the Holiday Inn. That's where Natalee Holloway had been staying.

Now, the search has been under way there for about four-and-a- half hours, and law enforcement sources close to the investigation do tell us that there's at least one FBI agent involved, possibly two, and that also a police dog and its handler from Miami-Dade Police are also assisting in the search there.

We've seen a fire truck drop off a large pump, and that seems to have been pumping water from in between part of the swampy area and some of the drainage ditches there. The green area that we've been seeing in those live pictures is a mangrove of bushes and shrubs and such. Unclear at this stage what has led police specifically to that area.

Lou.

DOBBS: Karl Penhaul from Palm Beach, Aruba. Thank you.

The Mexican government is trying to restore order tonight on part of its porous border with the United States. Hundreds of Mexican federal troops have moved in and taken over the entire town of Nuevo Laredo, Mexico. That town sinking deeper into drug, gang-fueled chaos. Nuevo Laredo is just over the border, of course, from Laredo, Texas.

Last week, the police chief of Nuevo Laredo, who had promised to get tough with drug gangs, was gunned down. He was assassinated. More than 30 bullets fired into his body just hours after he took office.

And over the weekend, Nuevo Laredo was the scene of an incredible shootout between Mexican federal troops and local police officers. Those local police officers are now accused of protecting drug gangs, and more than 40 have been detained.

One federal agent was seriously wounded in the shootout. The entire Nuevo Laredo police force has been detained. The Mexican government is promising to move into other border towns as soon as possible.

Hundreds of people have been killed in gang-related violence in and around Nuevo Laredo so far this year. The U.S. State Department has issued travel warnings for U.S. citizens near the Mexican border.

This dangerous mix of guns, drugs and corrupt law enforcement officials in Mexico just miles from the U.S. border is the subject of a border security hearing held on Capitol Hill today. U.S. officials say it is virtually impossible to fight crime and terror here in the United States without significant improvements in Mexican security.

Karen Schaler reports from Washington.

(BEGIN VIDEOTAPE)

KAREN SCHALER, CNN CORRESPONDENT (voice-over): Coming across our borders in record numbers, millions of pounds of illegal drugs. Immigration and Customs Enforcement says drug seizures are up more than 63 percent. A House subcommittee raised concerns about the increase in drug trafficking along the border, and the threat to homeland security.

UNIDENTIFIED MALE: It seems to me the same people that are taking the illegals over the border, taking the drugs over the border, are sure enough taking al Qaeda cells over the border also.

UNIDENTIFIED MALE: If you can smuggle drugs across, you can smuggle nuclear parts. If you can smuggle people across, you can smuggle drugs or nuclear parts. And to some degree, there is a merging of this.

SCHALER: Of all the drugs seized by Customs and Border Protection last year, almost 99 percent were seized along the southern border. In total, more than two million pounds of drugs.

UNIDENTIFIED MALE: The Southwest border is a center of gravity for most drugs smuggled into the United States. All smuggling, no matter what the commodity is involved, represents a vulnerability to our nation's security.

SCHALER: The increase in drug trafficking is also bringing an increase in violence along the southwest border.

UNIDENTIFIED MALE: Drug-related violence in Mexico has expanded beyond inter-gang warfare to include slayings of politicians, journalists, prison employees and police. This activity further undermines confidence in the government of Mexico and has the potential to spill over to the U.S. side of the border.

SCHALER: All the key U.S. agencies involved agree the only way to gain control of the border is by working together and sharing resources.

(END VIDEOTAPE)

SCHALER: But at the hearing, these U.S. agencies admitted they're just in the beginning stages of figuring out exactly how to work together. You have ICE and Customs and Border Protection both under Homeland Security, competing for funding and resources. Both agencies fielded some tough questions today about why they aren't sharing more information with each other. Both say they're working on it.

Lou.

DOBBS: Well, it's three-and-a-half years after 9/11. It is more than past time to work on it and to do something about border security, as we've been reporting on this broadcast now for the better part of that period.

Karen Schaler, thank you very much, reporting from Washington.

Defense Secretary Donald Rumsfeld today again defended the U.S. terrorist detention center at Guantanamo Bay, Cuba. The secretary of Defense called it the most scrutinized detention facility in the history of warfare. Secretary Rumsfeld was responding to calls that the center be overhauled or shut down because of alleged prisoner abuse.

Tonight's quote of the day comes from one of several lawmakers also defending policies at Guantanamo. Congressman Duncan Hunter, Republican of California, chairman of the House Armed Services Committee said, "The idea that somehow we are torturing people in Guantanamo is absolutely not true, unless you consider having to eat chicken three times a week real torture."

Coming up next here, American companies are turning their backs on democracy in order to turn a profit in communist China. We'll have a special report.

And why American taxpayers are paying for illegal aliens caught in this country, paying for their free trip back to Mexico.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: American companies are aiding and abetting the communist Chinese regime in their effort to repress the ideas of freedom and democracy on the Internet in China. Microsoft is the latest American company to be found to be cooperating with the Chinese government in censoring the content available to Chinese Internet users.

Bill Tucker reports.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Thousands of Americans put their lives on the line for America and its principles of freedom every day. President Bush has made it a hallmark of his administration to spread democracy.

Apparently, corporate America doesn't always follow the agenda. Microsoft only the latest company to sacrifice American principles for Chinese business (ph).

Yahoo! and Google have also agreed to restrictions on what searchers on the Chinese Internet can see and what information they have access to. The tradeoff is for entry to what they see as a lucrative market of some 90 million users.

TALA DOWLATSHANI, REPORTERS WITHOUT BORDERS: But if Microsoft is a U.S.-based company, and is allowed to set up portals for Web bloggers within the United States, which anyone can speak about any issue, then that same policy, that same ethical principle should be exercised abroad and overseas.

TUCKER: Microsoft responded to our calls with the following statement: "MSN Spaces in China is managed by its China joint venture, the Shanghai MSN Network Communications Technology Company. MSN abides by the laws, regulations and norms of each country in which it operates."

The U.S. Chamber of Commerce and the Information Technology Association defend the company, saying they do try to effect change, and argue that some American presence is better than none. What is needed, say critics, is for the administration to give these companies stronger backing in trade negotiations and for the U.S. to recognize it does have some leverage.

JOHN TKACIK, HERITAGE FOUNDATION: The bottom line is, we should not be afraid of economic retaliation from China. We basically should use our economic clout as China's top importer. I think we'll be surprised at how effective it is.

(END VIDEOTAPE)

TUCKER: And we should point out this is not an issue of Chinese law. Their constitution grants freedom of speech in the press. But clearly, the constitution is not enforced, making this an issue of what the Chinese do, Lou, not what they say.

DOBBS: The -- and the fact is that other companies -- does AOL, for example, a subsidiary of Time Warner, also follow these same rules?

TUCKER: They do...

DOBBS: Because we should focus on that as well.

TUCKER: We don't know. We put in calls to AOL. We know we do business there. We didn't get a call back.

DOBBS: And the issue here, too, that is confounding -- and as the spokesman for the Heritage Foundation pointed out -- U.S. corporations are creations of U.S. law in the United States itself as a nation. Their very existence is dependent upon that creation as a corporate entity.

For them to simply turn their back on American principles is remarkable. But of course, this is not the only time it occurs. It is occurring in so many business practices, including, amongst others, so-called free trade and outsourcing to cheap foreign labor markets.

A remarkable situation. And a sad one.

Bill Tucker, thank you.

That brings us to the subject of tonight's poll. Do you think Microsoft is wrong to exclude certain words in its China-based Web portal deemed taboo by communist authorities, yes or no?

Cast your vote at LouDobbs.com. We'll bring you the results here later tonight.

Coming up next, one local prosecutor calls on the United States attorney general, the secretary of State and the president of the United States to help bring hundreds of fugitives hiding in Mexico to justice in the United States for crimes committed here.

Also ahead, I'll be talking with the Canadian ambassador to the United States about border security, trade, the threat of terrorism, and the insistence on the part of U.S. national media to lump Canada and Mexico together as equal entities.

And is Iran a safe haven for al Qaeda? And even Osama bin Laden? I'll be talking with the author of the startling new book, "Countdown to Crisis" here next.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Vice President Dick Cheney said in a speech yesterday that more needs to be done to secure our lawless Mexican border -- this despite the fact that the Bush administration's 2006 budget calls for the addition of only 210 new Border Patrol agents.

(BEGIN VIDEO CLIP)

CHENEY: We need to do a combination of things -- that is, not only deal with the question of border security. We asked for this year additional money to beef up our border operations, improve technology, and hire more agents. Congress is working on it now and I'm sure there will be increased enhancement, if you will, of border security as a result of that ongoing process.

But we also need to move to address the fundamental underlying issue that drives illegal immigration, and that's the economic one.

(END VIDEO CLIP)

DOBBS: Vice President Dick Cheney talking about improved border security with the addition of 210 Border Patrol agents. Make of that what you will.

But while the United States barely raises its border enforcement budget, it is spending millions of dollars on a program that gives illegal aliens a free plane trip home at your expense. The United States says the money is well-spent.

Casey Wian reports.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT: This is the way most Mexican illegal aliens are deported, in vans that drop them off at the border. Because so many try to sneak across again, and again if necessary, U.S. immigration authorities are expanding a new controversial program. You might call these illegal aliens jet-setters because they're being flown to cities deep inside Mexico, courtesy of the U.S. taxpayer. This group arrived to a celebrity-style airport welcome in Mexico City, after the U.S. resumed its voluntary repatriation program. From the airport they board vans and buses for trips back to their hometowns. The theory is the further they're taken from the border, the less likely they'll try to cross again.

UNIDENTIFIED FEMALE: It is an important program for two reasons -- one, to mitigate some of the deaths that we've been having in the desert, and two, to stop the cycle of smuggling.

WIAN: Last year the government spent $15 million to deport 14,000 illegal aliens by air. This year, 1 million less is budgeted, yet the Border Patrol expects to deport 34,000, or two-and-a-half times as many, because of better financial planning. Philippe Randon (ph) said he was caught after four days in the Arizona desert, two without food or water. Still, he admits he'll probably cross again because jobs are scarce in his southern Mexico town.

So many of his countrymen have found work in the United States, that the Bank of Mexico projects they'll send home $20 billion this year, a 21 percent increase over 2004. Those so-called remittances have become a cornerstone of the Mexican economy, second only to oil as a source of foreign capital.

MIGUEL TINKER SALAS, POMONA COLLEGE: In many ways, the remittances are actually letting the government off the hook, in the sense of social services that they used to deliver to the Mexican population.

WIAN: And even some Mexican officials concede the growing remittances show the country is not generating enough job opportunities, unless you're an AeroMexico pilot, flying illegal aliens home.

(END VIDEOTAPE)

WIAN (on camera): Mexico is paying a portion of the repatriation flight costs, a very small portion. Last year it amounted to $244,000, or about 1/70 of the U.S. share.

Lou.

DOBBS: Hardly the kind of partnership that we hear President Bush and President Fox talk so much about, so warmly. The fact that these flights are continuing, the idea that they are being sent deep into the heart of Mexico, and at the same time, as you just reported, these illegal aliens say they're bound to go back the other way, any sign at all that this is effective?

WIAN: The Border Patrol says it is effective. In fact, they have gathered statistics that helped convince them to renew this program that showed that the typical illegal alien they arrest crossing the Arizona desert, 33 percent of them, they catch crossing again right away. Those that are sent back deeper into Mexico, they only find about 10 percent of them trying to cross again.

Lou.

DOBBS: An interesting statistic. Of course, it does leave out the other statistic which is the number of illegal aliens who cross the border successfully, estimated to be in the number of 3 million last year alone.

WIAN: And the documents that went along with this program also showed that. They showed that the number of migrant deaths were about the same, but the rate of migrant deaths were down because so many more illegal aliens were trying to come across the border.

Lou.

DOBBS: Good grief. Casey, thank you very much. Casey Wian reporting from Los Angeles. And Casey, we hope you get over the cold soon.

WIAN: OK. Thanks.

DOBBS: Officials rounded up 79 illegal aliens in Phoenix, Arizona, today. The illegal aliens were smuggled into the United States from Mexico and they were hiding inside a horse trailer when they were discovered. They had been packed together without air conditioning in the sweltering heat with nothing to eat nor to drink. There were among them 11 children and a four-month-old baby.

Last week on this program, we introduced you to John and Barbara March. They know painfully well about our broken border with Mexico. Their son, David, a Los Angeles County Sheriff's Deputy, was shot and killed at close range three years ago during what would have been a routine traffic stop. Authorities say his alleged killer, an illegal alien named Armando Garcia, fled to Mexico. He has still not been found. He has still not been brought to justice in the United States. The March family says the Mexican government is directly to blame.

(BEGIN VIDEO CLIP)

BARBARA MARCH, MOTHER OF SLAIN OFFICER: They are protecting him, giving him safe haven in Mexico, as with many other killers and felons here in the United States that belong back here for trial.

(END VIDEO CLIP)

DOBBS: Mexico, for its part, refuses to hand over criminal suspects to the United States if those suspects face the death penalty or life imprisonment without parole.

Los Angeles County District Attorney Steve Cooley says that is simply unacceptable, and the district attorney is now calling on the United States government to renegotiate that extradition treaty with Mexico. He joins us tonight. Good to have you with us.

STEVE COOLEY, L.A. COUNTRY D.A.: Thank you.

DOBBS: The idea that Mexico has, through its supreme court, decided that it will not in point of fact extradite a person facing life imprisonment without parole, and indeed, capital punishment, is a new development. And is it in your judgment a lawful rendering of the treaty?

COOLEY: Well, this development occurred with the supreme court decision October 2001, where the Mexican Supreme Court basically ruled that a sentence longer than 60 years in prison -- they determined sentences of 60 years or less -- offended their notions of the penal system and they would not allow extradition of their nationals to any other country unless there was a pre-agreement as to a certain number of years, specific years, that they had to agree to before they would extradite an individual back to the United States for trial.

Of course, that offends our sense of -- notion of justice, where we think the jurisdiction where the crime occurred should be the place where the person is prosecuted, and punished according to the laws of that jurisdiction. So we estimate, just out of California, several hundred individuals have been murdered, and the perpetrator has fled to Mexico and is currently in Mexico, and there's no justice for them.

DOBBS: There is no justice. Is there -- in talking with John and Barbara March, the parents of Deputy David March, they are frustrated and understandably so.

Why in the world is the United States government, the State Department, the United States Senate, why are they not equally frustrated and demanding at least a sensible response to an existing treaty that's existed almost 30 years?

COOLEY: Well, maybe they're not as frustrated or as angry, because their son or daughter or spouse or loved one has not been a murder victim where the known perpetrator has gone to Mexico. I have been urging, and many others have, too, that our federal authorities, the president, the secretary of State, certainly our attorney general, really focus on this issue, make it a high priority and deal with the sovereign nation of Mexico in such a way that there is a global solution to what is now a very serious problem, and one that will predictably be a growing problem in the future.

We believe, the L.A. County's D.A.'s Office, after studying this issue, that the Mexican government, because of their supreme court's decision, and their respecting it, they are in breach of the extradition treaty. And the federal government controls that treaty. Under our constitution, they exclusively negotiate treaties and it's their responsibility to evaluate this, see if they agree with us, that Mexico is in breach and go back to the table and resolve this problem once and for all. If not, they are denying justice to American citizens. They're endangering American citizens and they're endangering the good citizens of Mexico who may be hurt or injured or killed by the murderers who have fled our country.

DOBBS: Let me tell you that, Mr. District Attorney, that we have obviously received a statement from the Mexican government on this issue. Let me show you what their -- part of their response on the idea of extraditing fugitives.

The -- in the case of David March, saying that, "regarding the unfortunate death of Deputy David March in April [of] 2002, Mexico attaches a great priority to this case and has several agents exclusively dedicated to locate his presumed slayer, Armando Garcia, with the support of the U.S. authorities."

Obviously, what is not stated there is that Armando Garcia had been deported from the United States three times before allegedly committing this crime.

Do you have the same sense as the Mexican government, as to how well the investigation is going there, how well the level of cooperation is, how well the cooperation has been in this joint investigation as the Mexican government is styling it?

COOLEY: At some levels, there has been some cooperation on this case, primarily because of the public's outrage over the facts of this case, and the fact that there's no justice for the March family or the L.A. County Sheriff's Department family. So there has been some cooperation, only because of extraordinary public efforts on the part of many individuals.

None of that addresses the overall problem of literally hundreds of other -- thousands of others next of kin of hundreds of victims who aren't getting any sort of attention because of the current posture of the Mexican government in light of their Supreme Court's ruling.

DOBBS: Well, District Attorney Cooley, we will guarantee you that this broadcast will continue to focus on those families who are in pain and desperate for justice, and we certainly salute you in your efforts to win a rational renegotiation of that extradition treaty.

COOLEY: Well, Lou, I appreciate you bringing attention to this. And if the audience out there could look at our Web site on this topic, EscapingJustice.com, they will learn so much and be well informed and be as outraged as I think you are and I am, and any rational person would be, when they realize the facts of the situation.

DOBBS: And let's say that one more time. The Web site, the URL is?

COOLEY: EscapingJustice.com.

DOBBS: Steve Cooley, district attorney.

COOLEY: Thank you very much. DOBBS: We thank you for being here.

COOLEY: Thank you.

DOBBS: Still ahead, will tightened border security affect trade relations with our biggest trading partner? I'll be talking with the Canadian ambassador to the United States, here next.

And how this woman beat some amazing odds in the state of Pennsylvania, 419 million to one odds, to be exact. We'll have her story when we continue. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Since September 11, border security has become, of course, a critically important issue, not only in the United States but in Canada as well. My guest tonight says Canada has worked to keep North America closed to terrorists and open for business. He's recently been forced to defend Canada's security policies. And his country blasted those who associate Canada with Mexico when it comes to border security.

Joining me now is Canada's ambassador to the United States, Ambassador Frank McKenna. Ambassador, good to have you here.

FRANK MCKENNA, CANADIAN AMBASSADOR TO U.S.: Good to be here, Lou.

DOBBS: Let's begin with the issue that the United States wants apparently passports to be de rigueur for travel across the borders. Canada's reaction?

MCKENNA: Well, the reaction is, to start with, one of sympathy for the cause. We know how traumatized America's been with 9/11, and understand their interest in security. We have our own interest in security. But we think the passports-only idea would be an overly onerous requirement that would hurt -- in fact, devastate -- a lot of border communities.

People who make impulse decisions to play bingo in Calais, Maine, for example, from St. Stephen, or decide to go across the border at Niagara Falls for a bite to eat -- all of those kinds of decisions would become more difficult.

We don't think the administration, by the way, is hung up on passports only. From the president on down, they've shown a lot of flexibility towards coming up with a different solution.

DOBBS: But at same time, Ambassador, there is a spirit abroad, if you will, in the United States, certainly, that, well, if we don't require passports to the north, we certainly can't require them to the south because Mexico's also a member of NAFTA, and every bit as good a neighbor.

How do you react to that line of reasoning?

MCKENNA: I don't depreciate that Mexico is in fact a member of NAFTA, and a good neighbor. But I don't think that we should be trying to do equivalent things on the borders. The issues are just dramatically different.

DOBBS: How so?

MCKENNA: Well, the Mexican border, the major issue would be immigration. There are other issues, but immigration would be a huge issue.

On the northern border, that's just not the case. You don't hear of Canadians trying to get under barbed wire fences to get to the United States. We admire the United States, but we have a great deal of affection for our own country as well.

So the issues on the northern border are dramatically different. And our concerns on the northern border are two. One, respect the legitimate needs of both countries to be secure. But at the same time maintain what is the largest trading relationship in the entire world.

DOBBS: That trading relationship often strained over what to some might seem rather mundane items, things like softwood lumber, salmon, fishing rights. The list goes on. But nonetheless, the trade relationship is strong. It's robust. A contributing trade, about 50 percent of your GDP.

MCKENNA: It's a huge percent of our GDP. But in turn, you know, we're the biggest customer of the United States per capita in the entire world. One out of every $4 of exports comes to Canada. And 39 of your states have -- Canada is the biggest market for their exports. So we're your biggest consumer.

DOBBS: We love Canada. We love Canada.

MCKENNA: Glad to hear it.

DOBBS: It's all of those countries that...

MCKENNA: Plus...

DOBBS: ... with rising deficit...

MCKENNA: ... we are your biggest energy supplier. Most people don't realize that.

DOBBS: Did I mention, we love Canada?

MCKENNA: Oil, gas, everything.

DOBBS: You've got me convinced, Mr. Ambassador. Canada is, and has been, and I'm sure will always be, a great friend of the United States.

What is your reaction, though, when people talk -- we have 3 million -- an estimated 3 million illegal aliens crossing the border to the south. The idea that the economy somehow of Mexico, Canada, the United States, combined as a brilliant idea that will just extend the three-nation border and call that the North America, the recent recommendation of the Council on Foreign Relations. What do you think of that idea, which will just simply diminish our sovereignty and elbow up to one another, and call it a day?

MCKENNA: Well, that's not the position of the three governments. The three governments have their own plan, which was formulated down in Waco, and it consists of a lot of incremental changes. But nothing in the nature of the ambitious project that was anticipated.

But having said that, we do work together very closely at strengthening the border and making sure that commerce continues to flow. The relationship is strong. It's robust. But it doesn't -- it doesn't create a perimeter such as being discussed.

DOBBS: And let's -- I was stunned the other night, aghast, a Texas state senator here just threw it out, and I was so stunned I didn't even react. He said that, you know, when I was talking about improving border security with Mexico, he said, you know, we should be more concerned about Canada because that's where the 9/11 hijackers came from.

That's one of those myths that has grown up amongst even elected officials.

MCKENNA: It has, Lou. And it hurts us terribly, you know, because none of the 9/11 hijackers came from Canada. All 19 were legally present in the United States.

But you know, the reason it hurts...

DOBBS: Well, they weren't legally present.

MCKENNA: Right. But they were -- they were present. But I guess what hurts us is that we would never want to contribute in any way to anything that would harm our neighbor. The United States is our only neighbor, you know. And we take it very seriously that -- the security. We take our own security very seriously, because we're also on the al Qaeda hit list, and we want to protect Canadians.

DOBBS: Right. Ambassador Frank McKenna, we thank you for being here. We hope you'll come back.

MCKENNA: Thank you, I will.

DOBBS: And we look forward to talking to the ambassador from Mexico about many of the same issues.

MCKENNA: Thank you. Thank you.

DOBBS: Coming up here at the top of the hour on CNN, ANDERSON COOPER 360. Anderson with a preview. Tell us about it.

ANDERSON COOPER, HOST, ANDERSON COOPER 360: Lou, thanks very much.

Yeah, about 10 minutes from now, new developments in the search for Natalee Holloway in Aruba. Authorities have now cordoned off a specific area near the beachfront hotel where Holloway was staying when she disappeared. And while that search continues, so does the partying by American teens on Aruba.

Tonight on 360, we follow a group of teenage girls and guys as they go out for a night on the town. It is a shocking look at what American kids are still doing on Aruba. The precautions these teens are taking and not taking in light of Natalee's disappearance, something every parent should see.

All that and more at the top of the hour.

Lou.

DOBBS: Thank you very much, Anderson.

Imagine winning a million in the lottery. Imagine winning again. It's a 419 million to one chance, but that's exactly what happened to Pennsylvania's Donna Goeppert. She won $1 million playing a Pennsylvania lottery scratch-off game just five months ago; now she has won another million playing the very same game.

(BEGIN VIDEO CLIP)

DONNA GOEPPERT, WON LOTTERY TWICE: Feels fantastic. I'm still on a cloud. I don't feel like a millionaire; I just feel at ease now.

(END VIDEO CLIP)

DOBBS: In all, Donna Goeppert has won about $1.5 million after taxes. And I have a mother who loves to play those things. I hope it's not going to cost any more as a result of her good fortune.

Coming up next, the author of an explosive new book says Iran has been sheltering al Qaeda terrorists, including Osama bin Laden. He's our guest. He accuses the United States intelligence community of being willfully blind to the grave threat that Iran now poses to the United States. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight, we turn to the upcoming elections in Iran, what it means for international security. The current front-runner in Iran's election is Akbar Hashemi Rafsanjani, telling CNN in an exclusive interview today that Iran's nuclear enrichment program is purely peaceful.

(BEGIN VIDEO CLIP)

AKBAR HASHEMI RAFSANJANI, IRANIAN PRESIDENTIAL CANDIDATE (through translator): There is no reason for us to concede anything. We have nothing to hide. This is our right, our inalienable right.

(END VIDEO CLIP)

DOBBS: Rafsanjani denied that Iran is supporting terrorism or giving safe haven to known al Qaeda operatives. My guest tonight is Kenneth Timmerman. He vigorously disagrees with Rafsanjani. Timmerman is an investigative journalist, the author of "Countdown to Crisis: The Coming Nuclear Showdown with Iran," asserting the current regime is actively supporting al Qaeda and represents a clear and present danger to the United States. And good to have you here.

KENNETH TIMMERMAN, AUTHOR, "COUNTDOWN TO CRISIS": Thanks for having me, Lou.

DOBBS: These are strong claims. You not only suggest that they pose a clear danger to the United States, but Osama bin Laden is being harbored in Iran?

TIMMERMAN: Yes. And I've got to just tell you briefly my sources on this. I've worked as an investigative reporter, and I've spent many, many years debriefing Iranian defectors. These are people who have had positions in Iranian intelligence organizations. They've come out as patriots, bringing information about what's going on inside the regime. So I'm trying to tell the inside story, instead of the story that we get here from the United States from the outside.

DOBBS: 9/11 Commission member John Lehman endorses your book strongly, and pointing to the failures of the intelligence community. Did other members of the intelligence -- the 9/11 Commission review any of your sources and your work?

TIMMERMAN: I did speak with other members of the commission, people who were involved in the commission. One of the extraordinary stories that I uncovered in this investigation was that the CIA had been holding back information about Iran's involvement with al Qaeda. In fact, they had extensive information.

DOBBS: Before 9/11?

TIMMERMAN: Before 9/11, yes. They had extensive information about the coordination between the Iranian regime and al Qaeda, and indeed in the planning phase of the 9/11 attacks. And I tell that story in this book.

DOBBS: The Iranian nuclear facilities, Rafsanjani says, despite contrary evidence as focused on by this administration, that their need for nuclear fuels is purely peaceful?

TIMMERMAN: A very expensive play toy. Iran does not need nuclear fuel. They flare so much gas they could heat the entire region with what they just burn off into the air. The facilities they've built are exactly what they need for a nuclear weapons program.

DOBBS: The CIA, we talked to -- with them today. They declined to talk to -- to comment on your claims. Any thoughts?

TIMMERMAN: I'm not surprised. The CIA has rejected defectors. They're not able to sort out the true from the falsehood. I spent an awful lot of time doing this. You'll read about the defectors yourself in the book. I think people can make their own judgments.

DOBBS: Kenneth Timmerman, thanks for being here.

Still ahead, the results of our poll. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Now, the results of our poll. Do you think Microsoft is wrong to exclude certain words in its China-based Web portal deemed taboo by communist authorities? Seventy-two percent of you voting yes, 28 percent no.

Thanks for being with us here tonight. Tomorrow, Senator Maria Cantwell joins me. She has a plan to slash our dependence on foreign oil by almost half in just two decades. She'll be here to tell us about that. She will be among all of our guests.

For all of us here, happy Flag Day, and good night from New York. ANDERSON COOPER 360 starts right now.

Anderson.

COOPER: Lou, thanks very much.

END

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, 2005 - 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: Good evening, everybody. Tonight, no less than four deadly attacks sweeping across Iraq. At least 30 people were killed, including an American soldier. The enduring violence is causing some now to demand answers about when the United States forces will leave Iraq.
Tonight, a new book accusing another member of President Bush's axis of evil, Iran, of harboring Osama bin Laden. The author of that book says the United States is on the verge of a nuclear showdown with Iran. He is among our guests here tonight.

And Microsoft working with the Chinese government to block freedom in China. How Microsoft and other American companies are censoring their Chinese customers who would otherwise want to talk about democracy. We'll have that special report.

But first, alarming new questions tonight about the role of U.N. Secretary-General Kofi Annan in the oil-for-food program scandal. A newly discovered memorandum appears to contradict repeated denials from both the secretary-general and his son about the roles they played in awarding a multimillion-dollar oil-for-food contract. An internal memo from the company that won that contract, Cotecna, now raises questions not only about those denials, but about the secretary-general's future as head of the United Nations.

Richard Roth reports.

(BEGIN VIDEOTAPE)

RICHARD ROTH, CNN SR. UNITED NATIONS CORRESPONDENT (voice-over): The scandal will plague Kofi Annan until the end of his term as secretary-general.

KOFI ANNAN, U.N. SECRETARY-GENERAL: For some, the oil-for-food crisis will never die down.

ROTH: The problem for Annan is that things keep popping up. The latest, a new portion of an e-mail which at the very least, raises questions again regarding a link between Annan and the awarding of a contract to Cotecna, the Swiss-based company paid $10 million a year to inspect humanitarian goods entering Iraq, the same company that once employed Annan's son Kojo.

Earlier this year, the U.N. authorized oil-for-food investigator, Paul Volcker, concluded he didn't have enough evidence to allege any corruption by Annan. Now, Cotecna has discovered an e-mail from a vice president, Michael Wilson, to company leaders in 1998. Wilson, part of the Cotecna team whose mission was to win the contract, wrote, "We had brief discussions with the secretary-general and his entourage, and we could count on their support."

The Volcker panel says it is now urgently reviewing the newly- turned-over documents and travel records handed over by the U.N. A spokesman said Annan was in Paris in 1998 where the memo alleges a meeting occurred, but that Annan was not involved in any Cotecna meeting and never even knew of the Cotecna interest in the contract.

FRED ECKHARD, U.N. SPOKESMAN: We spoke to the secretary-general, who's in Paris today, and he has no recollection of any such exchange. And the views attributed to him in this e-mail by Michael Wilson...

ROTH: A week after Wilson's e-mail, Cotecna won the oil-for-food contract. Its bid was the lowest.

(END VIDEOTAPE)

ROTH: Wilson is no longer with Cotecna, and the company told us today, Lou, that he exaggerates his own importance. Wilson is also known to call Kofi Annan "Uncle" based upon a close family relationship back in Ghana, where both come from. And Wilson is also a childhood friend of Kojo Annan, the secretary-general's son. The Volcker Commission has said that Kojo Annan has not been cooperating.

Lou.

DOBBS: Well, obviously Wilson has in some degree here the sudden emergence of these words by Wilson implicating, at least on their face, the U.N. secretary-general. Why the timing? How did it occur? Do we know?

ROTH: Cotecna says their new audit - quote -- accidentally discovered this. A portion of this e-mail was already in Volcker's hands. If you read the last Volcker report, there's extensive notes about Michael Wilson, and Michael Wilson maybe not remembering and then refreshing his memory.

It's just these new words have now been turned over by Cotecna. And certainly, when you see the Volcker panel say they are now urgently going to look at them, you have not seen that type of tone before, because, in effect, they cleared Annan on corruption, something that Annan says he was exonerated on. This puts things in a totally new light potentially.

DOBBS: Richard Roth, our senior U.N. correspondent. Thank you, Richard.

The Senate investigators also, of course, will be taking a careful look at these new emerging details.

Senate Republicans, meanwhile, are hoping to force a vote this week on President Bush's nominee to be United Nations ambassador, John Bolton. Senate Majority Leader Bill Frist and Senator John McCain today accused Democrats of obstructing Bolton's nomination and confirmation. Senator Frist said he will soon hold another procedural vote on Bolton's nomination, even though he concedes there might not be enough votes to force final confirmation. Democrats have demanded the White House release more records of Bolton's work at the State Department.

Bolton, for his part, has been accused of abusing his colleagues and misusing his access to classified information. Those accusations, of course, coming from the Democrats on the committee.

In Iraq today, an American soldier was killed when he was struck by a rocket-propelled grenade in Baghdad. The U.S. military also reporting two U.S. soldiers were killed yesterday in a bombing in Ramadi.

A new attack today at a critical Ramadi entry point killed an Iraqi soldier. Soon after that attack, the military says coalition forces opened fire on a car speeding toward the entry point. Five Iraqis were killed in that exchange.

In Kirkuk, at least 19 people were killed when a suicide bomber blew himself up outside a bank. Ninety people were wounded in the explosion. Iraqi officials say most of the dead and wounded were waiting to pick up their paychecks.

Near Baquba, insurgents coordinated a car bombing and a mortar attack on a police station. Five people were killed, including members of the Iraqi police and Iraqi army.

More than 1,700 of our troops have now been killed in Iraq over the past 28 months. These last 10 weeks have been among the deadliest for U.S. forces since the war began. The unending violence has renewed some calls for the United States to set a clear time frame for withdrawal from Iraq.

Kitty Pilgrim reports.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice-over): General George Casey, the top U.S. commander in Iraq, calls fighting the Iraqi insurgency the "Pillsbury Doughboy" idea. You push in one area, and attacks pop out in another. Top military officials today confirm the number of attacks is still running at some 50 to 60 a day.

GEN. PETER PACE, VICE CHAIRMAN, JOINT CHIEFS OF STAFF: But I would not chase the spikes and dips in the security situation. If you draw a straight line through the middle of that, it's fairly constant. That's not good or bad. It's fact.

PILGRIM: But analysts say April, May and June are all on track for the highest attack rates in the last year. The Bush administration recently trying to paint those statistics as a last gasp of the insurgency. RICHARD CHENEY, VICE PRESIDENT OF THE UNITED STATES: I think the level of activity that we see today from a military standpoint, I think, will clearly decline. I think they're in the last throes, if you will, of the insurgency.

PILGRIM: But some in Congress are criticizing, saying that spin doesn't match the reality on the ground. On ABC News this week, one previous supporter of the Iraqi operation said he is now calling for a timetable to withdraw.

REP. WALTER JONES (R), NORTH CAROLINA: I voted for the resolution to commit the troops, and I feel that we've done about as much as we can do.

PILGRIM: The president's spokesman saying there will be no schedule for troop withdrawal.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: The message that it sends to terrorists and others, is all you have to do is wait and we'll leave.

PILGRIM: The most recent Gallup poll finds 59 percent of people want to withdraw some or all troops from Iraq, one of the most negative readings on the war since it began in 2003.

(END VIDEOTAPE)

PILGRIM: Now, military officials are increasingly talking about the need for political solutions to complement the military effort. U.S. forces can help with the military training of Iraqi soldiers, but they admit that the political momentum has to come from the Iraqis themselves.

Lou.

DOBBS: Kitty, thank you very much.

Tonight, an unprecedented rebuke for a group that has been critical of the United States' role in Iraq, the International Committee of the Red Cross. And according to a group of Senate Republicans, the IRC has lost its way. A new Senate report says the ICRC is actively working against the interests of its largest donor, the United States.

Christine Romans reports.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): A powerful group of Republican senators says the International Committee of the Red Cross has lost its way. A 10-page white paper from the Republican Policy Committee charges the International Red Cross has abandoned its impartiality. "It has become more responsive to the preferences of the liberal and frequently anti-American international nongovernmental organization community." The ICRC has been critical of the U.S. treatment of prisoners at Guantanamo Bay, Cuba, and in Iraq. But the senators say the ICRC is unfairly accusing the U.S. of violating the Geneva Conventions and is interpreting international law to give terrorists the same rights as legitimate military personnel. Further, the white paper chastises the Red Cross for crusading against landmines, cluster bombs and tear gas outside of their mandate.

UNIDENTIFIED MALE: They are getting involved in wanting to develop new laws, and involved in advocacy. And there's -- they are getting away from their most basic core, humanitarian duties, and that's helping aid in a crisis situation to the many suffering people. So they have to be careful about -- about doing that.

ROMANS: The senators, led by Jon Kyl of Arizona, demand an investigation into whether U.S. taxpayer money is being used at cross- purposes with U.S. interests. The ICRC says it is reviewing the paper and will - quote -- "discuss the issues with those concerned bilaterally through our usual working channels. We are committed to working transparently and to the best of our capacity to fulfill our humanitarian mandate."

(END VIDEOTAPE)

ROMANS: Over the past 15 years, the United States has given $1.5 billion to this group, in large part because of the ICRC's history, saving American lives in two world wars, and for its humanitarian work around the world. Now the senators say for this, the group deserves praise and recognition. But the senators call its drift into activism very worrisome.

Lou.

DOBBS: And this is a process that some say has been accelerating over recent years. And the fact is that there is a desperate crying need to look into the role of nongovernmental organizations all around the world, even those like the ICRC, that have provided important humanitarian work, certainly.

Christine, thank you.

ROMANS: You're welcome.

DOBBS: Christine Romans.

Coming up next here, a desperate new search in Aruba. Officials have a tip now that could solve the mystery of missing Natalee Holloway.

Also tonight, a massive law and order breakdown just over the Rio Grande. U.S. officials say violence in Nuevo Laredo, Mexico, could spread across the border.

And, is Microsoft going soft on China? Critics say the high-tech giant has caved in to political pressure from Beijing and has ignored President Bush's focus on freedom and democracy. Those stories and more coming right up.

(COMMERCIAL BREAK)

DOBBS: New developments tonight in the search for Natalee Holloway, the teenager who disappeared in Aruba more than two weeks ago. Police tonight have cordoned off an area near a beach-front hotel in Aruba. An extensive search is now under way in the water and on land near the hotel.

Karl Penhaul joins us now live from Palm Beach, Aruba, with the latest. Karl.

KARL PENHAUL, CNN CORRESPONDENT: We can see that area on a live picture that we've got up now. It's about 500 yards long, and at its widest point about 150 yards wide. It's sandwiched between the main highway that leads around the coast and the beach area next to the Marriott hotel.

That's about a mile and a half from where I'm standing at the Holiday Inn. That's where Natalee Holloway had been staying.

Now, the search has been under way there for about four-and-a- half hours, and law enforcement sources close to the investigation do tell us that there's at least one FBI agent involved, possibly two, and that also a police dog and its handler from Miami-Dade Police are also assisting in the search there.

We've seen a fire truck drop off a large pump, and that seems to have been pumping water from in between part of the swampy area and some of the drainage ditches there. The green area that we've been seeing in those live pictures is a mangrove of bushes and shrubs and such. Unclear at this stage what has led police specifically to that area.

Lou.

DOBBS: Karl Penhaul from Palm Beach, Aruba. Thank you.

The Mexican government is trying to restore order tonight on part of its porous border with the United States. Hundreds of Mexican federal troops have moved in and taken over the entire town of Nuevo Laredo, Mexico. That town sinking deeper into drug, gang-fueled chaos. Nuevo Laredo is just over the border, of course, from Laredo, Texas.

Last week, the police chief of Nuevo Laredo, who had promised to get tough with drug gangs, was gunned down. He was assassinated. More than 30 bullets fired into his body just hours after he took office.

And over the weekend, Nuevo Laredo was the scene of an incredible shootout between Mexican federal troops and local police officers. Those local police officers are now accused of protecting drug gangs, and more than 40 have been detained.

One federal agent was seriously wounded in the shootout. The entire Nuevo Laredo police force has been detained. The Mexican government is promising to move into other border towns as soon as possible.

Hundreds of people have been killed in gang-related violence in and around Nuevo Laredo so far this year. The U.S. State Department has issued travel warnings for U.S. citizens near the Mexican border.

This dangerous mix of guns, drugs and corrupt law enforcement officials in Mexico just miles from the U.S. border is the subject of a border security hearing held on Capitol Hill today. U.S. officials say it is virtually impossible to fight crime and terror here in the United States without significant improvements in Mexican security.

Karen Schaler reports from Washington.

(BEGIN VIDEOTAPE)

KAREN SCHALER, CNN CORRESPONDENT (voice-over): Coming across our borders in record numbers, millions of pounds of illegal drugs. Immigration and Customs Enforcement says drug seizures are up more than 63 percent. A House subcommittee raised concerns about the increase in drug trafficking along the border, and the threat to homeland security.

UNIDENTIFIED MALE: It seems to me the same people that are taking the illegals over the border, taking the drugs over the border, are sure enough taking al Qaeda cells over the border also.

UNIDENTIFIED MALE: If you can smuggle drugs across, you can smuggle nuclear parts. If you can smuggle people across, you can smuggle drugs or nuclear parts. And to some degree, there is a merging of this.

SCHALER: Of all the drugs seized by Customs and Border Protection last year, almost 99 percent were seized along the southern border. In total, more than two million pounds of drugs.

UNIDENTIFIED MALE: The Southwest border is a center of gravity for most drugs smuggled into the United States. All smuggling, no matter what the commodity is involved, represents a vulnerability to our nation's security.

SCHALER: The increase in drug trafficking is also bringing an increase in violence along the southwest border.

UNIDENTIFIED MALE: Drug-related violence in Mexico has expanded beyond inter-gang warfare to include slayings of politicians, journalists, prison employees and police. This activity further undermines confidence in the government of Mexico and has the potential to spill over to the U.S. side of the border.

SCHALER: All the key U.S. agencies involved agree the only way to gain control of the border is by working together and sharing resources.

(END VIDEOTAPE)

SCHALER: But at the hearing, these U.S. agencies admitted they're just in the beginning stages of figuring out exactly how to work together. You have ICE and Customs and Border Protection both under Homeland Security, competing for funding and resources. Both agencies fielded some tough questions today about why they aren't sharing more information with each other. Both say they're working on it.

Lou.

DOBBS: Well, it's three-and-a-half years after 9/11. It is more than past time to work on it and to do something about border security, as we've been reporting on this broadcast now for the better part of that period.

Karen Schaler, thank you very much, reporting from Washington.

Defense Secretary Donald Rumsfeld today again defended the U.S. terrorist detention center at Guantanamo Bay, Cuba. The secretary of Defense called it the most scrutinized detention facility in the history of warfare. Secretary Rumsfeld was responding to calls that the center be overhauled or shut down because of alleged prisoner abuse.

Tonight's quote of the day comes from one of several lawmakers also defending policies at Guantanamo. Congressman Duncan Hunter, Republican of California, chairman of the House Armed Services Committee said, "The idea that somehow we are torturing people in Guantanamo is absolutely not true, unless you consider having to eat chicken three times a week real torture."

Coming up next here, American companies are turning their backs on democracy in order to turn a profit in communist China. We'll have a special report.

And why American taxpayers are paying for illegal aliens caught in this country, paying for their free trip back to Mexico.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: American companies are aiding and abetting the communist Chinese regime in their effort to repress the ideas of freedom and democracy on the Internet in China. Microsoft is the latest American company to be found to be cooperating with the Chinese government in censoring the content available to Chinese Internet users.

Bill Tucker reports.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Thousands of Americans put their lives on the line for America and its principles of freedom every day. President Bush has made it a hallmark of his administration to spread democracy.

Apparently, corporate America doesn't always follow the agenda. Microsoft only the latest company to sacrifice American principles for Chinese business (ph).

Yahoo! and Google have also agreed to restrictions on what searchers on the Chinese Internet can see and what information they have access to. The tradeoff is for entry to what they see as a lucrative market of some 90 million users.

TALA DOWLATSHANI, REPORTERS WITHOUT BORDERS: But if Microsoft is a U.S.-based company, and is allowed to set up portals for Web bloggers within the United States, which anyone can speak about any issue, then that same policy, that same ethical principle should be exercised abroad and overseas.

TUCKER: Microsoft responded to our calls with the following statement: "MSN Spaces in China is managed by its China joint venture, the Shanghai MSN Network Communications Technology Company. MSN abides by the laws, regulations and norms of each country in which it operates."

The U.S. Chamber of Commerce and the Information Technology Association defend the company, saying they do try to effect change, and argue that some American presence is better than none. What is needed, say critics, is for the administration to give these companies stronger backing in trade negotiations and for the U.S. to recognize it does have some leverage.

JOHN TKACIK, HERITAGE FOUNDATION: The bottom line is, we should not be afraid of economic retaliation from China. We basically should use our economic clout as China's top importer. I think we'll be surprised at how effective it is.

(END VIDEOTAPE)

TUCKER: And we should point out this is not an issue of Chinese law. Their constitution grants freedom of speech in the press. But clearly, the constitution is not enforced, making this an issue of what the Chinese do, Lou, not what they say.

DOBBS: The -- and the fact is that other companies -- does AOL, for example, a subsidiary of Time Warner, also follow these same rules?

TUCKER: They do...

DOBBS: Because we should focus on that as well.

TUCKER: We don't know. We put in calls to AOL. We know we do business there. We didn't get a call back.

DOBBS: And the issue here, too, that is confounding -- and as the spokesman for the Heritage Foundation pointed out -- U.S. corporations are creations of U.S. law in the United States itself as a nation. Their very existence is dependent upon that creation as a corporate entity.

For them to simply turn their back on American principles is remarkable. But of course, this is not the only time it occurs. It is occurring in so many business practices, including, amongst others, so-called free trade and outsourcing to cheap foreign labor markets.

A remarkable situation. And a sad one.

Bill Tucker, thank you.

That brings us to the subject of tonight's poll. Do you think Microsoft is wrong to exclude certain words in its China-based Web portal deemed taboo by communist authorities, yes or no?

Cast your vote at LouDobbs.com. We'll bring you the results here later tonight.

Coming up next, one local prosecutor calls on the United States attorney general, the secretary of State and the president of the United States to help bring hundreds of fugitives hiding in Mexico to justice in the United States for crimes committed here.

Also ahead, I'll be talking with the Canadian ambassador to the United States about border security, trade, the threat of terrorism, and the insistence on the part of U.S. national media to lump Canada and Mexico together as equal entities.

And is Iran a safe haven for al Qaeda? And even Osama bin Laden? I'll be talking with the author of the startling new book, "Countdown to Crisis" here next.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Vice President Dick Cheney said in a speech yesterday that more needs to be done to secure our lawless Mexican border -- this despite the fact that the Bush administration's 2006 budget calls for the addition of only 210 new Border Patrol agents.

(BEGIN VIDEO CLIP)

CHENEY: We need to do a combination of things -- that is, not only deal with the question of border security. We asked for this year additional money to beef up our border operations, improve technology, and hire more agents. Congress is working on it now and I'm sure there will be increased enhancement, if you will, of border security as a result of that ongoing process.

But we also need to move to address the fundamental underlying issue that drives illegal immigration, and that's the economic one.

(END VIDEO CLIP)

DOBBS: Vice President Dick Cheney talking about improved border security with the addition of 210 Border Patrol agents. Make of that what you will.

But while the United States barely raises its border enforcement budget, it is spending millions of dollars on a program that gives illegal aliens a free plane trip home at your expense. The United States says the money is well-spent.

Casey Wian reports.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT: This is the way most Mexican illegal aliens are deported, in vans that drop them off at the border. Because so many try to sneak across again, and again if necessary, U.S. immigration authorities are expanding a new controversial program. You might call these illegal aliens jet-setters because they're being flown to cities deep inside Mexico, courtesy of the U.S. taxpayer. This group arrived to a celebrity-style airport welcome in Mexico City, after the U.S. resumed its voluntary repatriation program. From the airport they board vans and buses for trips back to their hometowns. The theory is the further they're taken from the border, the less likely they'll try to cross again.

UNIDENTIFIED FEMALE: It is an important program for two reasons -- one, to mitigate some of the deaths that we've been having in the desert, and two, to stop the cycle of smuggling.

WIAN: Last year the government spent $15 million to deport 14,000 illegal aliens by air. This year, 1 million less is budgeted, yet the Border Patrol expects to deport 34,000, or two-and-a-half times as many, because of better financial planning. Philippe Randon (ph) said he was caught after four days in the Arizona desert, two without food or water. Still, he admits he'll probably cross again because jobs are scarce in his southern Mexico town.

So many of his countrymen have found work in the United States, that the Bank of Mexico projects they'll send home $20 billion this year, a 21 percent increase over 2004. Those so-called remittances have become a cornerstone of the Mexican economy, second only to oil as a source of foreign capital.

MIGUEL TINKER SALAS, POMONA COLLEGE: In many ways, the remittances are actually letting the government off the hook, in the sense of social services that they used to deliver to the Mexican population.

WIAN: And even some Mexican officials concede the growing remittances show the country is not generating enough job opportunities, unless you're an AeroMexico pilot, flying illegal aliens home.

(END VIDEOTAPE)

WIAN (on camera): Mexico is paying a portion of the repatriation flight costs, a very small portion. Last year it amounted to $244,000, or about 1/70 of the U.S. share.

Lou.

DOBBS: Hardly the kind of partnership that we hear President Bush and President Fox talk so much about, so warmly. The fact that these flights are continuing, the idea that they are being sent deep into the heart of Mexico, and at the same time, as you just reported, these illegal aliens say they're bound to go back the other way, any sign at all that this is effective?

WIAN: The Border Patrol says it is effective. In fact, they have gathered statistics that helped convince them to renew this program that showed that the typical illegal alien they arrest crossing the Arizona desert, 33 percent of them, they catch crossing again right away. Those that are sent back deeper into Mexico, they only find about 10 percent of them trying to cross again.

Lou.

DOBBS: An interesting statistic. Of course, it does leave out the other statistic which is the number of illegal aliens who cross the border successfully, estimated to be in the number of 3 million last year alone.

WIAN: And the documents that went along with this program also showed that. They showed that the number of migrant deaths were about the same, but the rate of migrant deaths were down because so many more illegal aliens were trying to come across the border.

Lou.

DOBBS: Good grief. Casey, thank you very much. Casey Wian reporting from Los Angeles. And Casey, we hope you get over the cold soon.

WIAN: OK. Thanks.

DOBBS: Officials rounded up 79 illegal aliens in Phoenix, Arizona, today. The illegal aliens were smuggled into the United States from Mexico and they were hiding inside a horse trailer when they were discovered. They had been packed together without air conditioning in the sweltering heat with nothing to eat nor to drink. There were among them 11 children and a four-month-old baby.

Last week on this program, we introduced you to John and Barbara March. They know painfully well about our broken border with Mexico. Their son, David, a Los Angeles County Sheriff's Deputy, was shot and killed at close range three years ago during what would have been a routine traffic stop. Authorities say his alleged killer, an illegal alien named Armando Garcia, fled to Mexico. He has still not been found. He has still not been brought to justice in the United States. The March family says the Mexican government is directly to blame.

(BEGIN VIDEO CLIP)

BARBARA MARCH, MOTHER OF SLAIN OFFICER: They are protecting him, giving him safe haven in Mexico, as with many other killers and felons here in the United States that belong back here for trial.

(END VIDEO CLIP)

DOBBS: Mexico, for its part, refuses to hand over criminal suspects to the United States if those suspects face the death penalty or life imprisonment without parole.

Los Angeles County District Attorney Steve Cooley says that is simply unacceptable, and the district attorney is now calling on the United States government to renegotiate that extradition treaty with Mexico. He joins us tonight. Good to have you with us.

STEVE COOLEY, L.A. COUNTRY D.A.: Thank you.

DOBBS: The idea that Mexico has, through its supreme court, decided that it will not in point of fact extradite a person facing life imprisonment without parole, and indeed, capital punishment, is a new development. And is it in your judgment a lawful rendering of the treaty?

COOLEY: Well, this development occurred with the supreme court decision October 2001, where the Mexican Supreme Court basically ruled that a sentence longer than 60 years in prison -- they determined sentences of 60 years or less -- offended their notions of the penal system and they would not allow extradition of their nationals to any other country unless there was a pre-agreement as to a certain number of years, specific years, that they had to agree to before they would extradite an individual back to the United States for trial.

Of course, that offends our sense of -- notion of justice, where we think the jurisdiction where the crime occurred should be the place where the person is prosecuted, and punished according to the laws of that jurisdiction. So we estimate, just out of California, several hundred individuals have been murdered, and the perpetrator has fled to Mexico and is currently in Mexico, and there's no justice for them.

DOBBS: There is no justice. Is there -- in talking with John and Barbara March, the parents of Deputy David March, they are frustrated and understandably so.

Why in the world is the United States government, the State Department, the United States Senate, why are they not equally frustrated and demanding at least a sensible response to an existing treaty that's existed almost 30 years?

COOLEY: Well, maybe they're not as frustrated or as angry, because their son or daughter or spouse or loved one has not been a murder victim where the known perpetrator has gone to Mexico. I have been urging, and many others have, too, that our federal authorities, the president, the secretary of State, certainly our attorney general, really focus on this issue, make it a high priority and deal with the sovereign nation of Mexico in such a way that there is a global solution to what is now a very serious problem, and one that will predictably be a growing problem in the future.

We believe, the L.A. County's D.A.'s Office, after studying this issue, that the Mexican government, because of their supreme court's decision, and their respecting it, they are in breach of the extradition treaty. And the federal government controls that treaty. Under our constitution, they exclusively negotiate treaties and it's their responsibility to evaluate this, see if they agree with us, that Mexico is in breach and go back to the table and resolve this problem once and for all. If not, they are denying justice to American citizens. They're endangering American citizens and they're endangering the good citizens of Mexico who may be hurt or injured or killed by the murderers who have fled our country.

DOBBS: Let me tell you that, Mr. District Attorney, that we have obviously received a statement from the Mexican government on this issue. Let me show you what their -- part of their response on the idea of extraditing fugitives.

The -- in the case of David March, saying that, "regarding the unfortunate death of Deputy David March in April [of] 2002, Mexico attaches a great priority to this case and has several agents exclusively dedicated to locate his presumed slayer, Armando Garcia, with the support of the U.S. authorities."

Obviously, what is not stated there is that Armando Garcia had been deported from the United States three times before allegedly committing this crime.

Do you have the same sense as the Mexican government, as to how well the investigation is going there, how well the level of cooperation is, how well the cooperation has been in this joint investigation as the Mexican government is styling it?

COOLEY: At some levels, there has been some cooperation on this case, primarily because of the public's outrage over the facts of this case, and the fact that there's no justice for the March family or the L.A. County Sheriff's Department family. So there has been some cooperation, only because of extraordinary public efforts on the part of many individuals.

None of that addresses the overall problem of literally hundreds of other -- thousands of others next of kin of hundreds of victims who aren't getting any sort of attention because of the current posture of the Mexican government in light of their Supreme Court's ruling.

DOBBS: Well, District Attorney Cooley, we will guarantee you that this broadcast will continue to focus on those families who are in pain and desperate for justice, and we certainly salute you in your efforts to win a rational renegotiation of that extradition treaty.

COOLEY: Well, Lou, I appreciate you bringing attention to this. And if the audience out there could look at our Web site on this topic, EscapingJustice.com, they will learn so much and be well informed and be as outraged as I think you are and I am, and any rational person would be, when they realize the facts of the situation.

DOBBS: And let's say that one more time. The Web site, the URL is?

COOLEY: EscapingJustice.com.

DOBBS: Steve Cooley, district attorney.

COOLEY: Thank you very much. DOBBS: We thank you for being here.

COOLEY: Thank you.

DOBBS: Still ahead, will tightened border security affect trade relations with our biggest trading partner? I'll be talking with the Canadian ambassador to the United States, here next.

And how this woman beat some amazing odds in the state of Pennsylvania, 419 million to one odds, to be exact. We'll have her story when we continue. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Since September 11, border security has become, of course, a critically important issue, not only in the United States but in Canada as well. My guest tonight says Canada has worked to keep North America closed to terrorists and open for business. He's recently been forced to defend Canada's security policies. And his country blasted those who associate Canada with Mexico when it comes to border security.

Joining me now is Canada's ambassador to the United States, Ambassador Frank McKenna. Ambassador, good to have you here.

FRANK MCKENNA, CANADIAN AMBASSADOR TO U.S.: Good to be here, Lou.

DOBBS: Let's begin with the issue that the United States wants apparently passports to be de rigueur for travel across the borders. Canada's reaction?

MCKENNA: Well, the reaction is, to start with, one of sympathy for the cause. We know how traumatized America's been with 9/11, and understand their interest in security. We have our own interest in security. But we think the passports-only idea would be an overly onerous requirement that would hurt -- in fact, devastate -- a lot of border communities.

People who make impulse decisions to play bingo in Calais, Maine, for example, from St. Stephen, or decide to go across the border at Niagara Falls for a bite to eat -- all of those kinds of decisions would become more difficult.

We don't think the administration, by the way, is hung up on passports only. From the president on down, they've shown a lot of flexibility towards coming up with a different solution.

DOBBS: But at same time, Ambassador, there is a spirit abroad, if you will, in the United States, certainly, that, well, if we don't require passports to the north, we certainly can't require them to the south because Mexico's also a member of NAFTA, and every bit as good a neighbor.

How do you react to that line of reasoning?

MCKENNA: I don't depreciate that Mexico is in fact a member of NAFTA, and a good neighbor. But I don't think that we should be trying to do equivalent things on the borders. The issues are just dramatically different.

DOBBS: How so?

MCKENNA: Well, the Mexican border, the major issue would be immigration. There are other issues, but immigration would be a huge issue.

On the northern border, that's just not the case. You don't hear of Canadians trying to get under barbed wire fences to get to the United States. We admire the United States, but we have a great deal of affection for our own country as well.

So the issues on the northern border are dramatically different. And our concerns on the northern border are two. One, respect the legitimate needs of both countries to be secure. But at the same time maintain what is the largest trading relationship in the entire world.

DOBBS: That trading relationship often strained over what to some might seem rather mundane items, things like softwood lumber, salmon, fishing rights. The list goes on. But nonetheless, the trade relationship is strong. It's robust. A contributing trade, about 50 percent of your GDP.

MCKENNA: It's a huge percent of our GDP. But in turn, you know, we're the biggest customer of the United States per capita in the entire world. One out of every $4 of exports comes to Canada. And 39 of your states have -- Canada is the biggest market for their exports. So we're your biggest consumer.

DOBBS: We love Canada. We love Canada.

MCKENNA: Glad to hear it.

DOBBS: It's all of those countries that...

MCKENNA: Plus...

DOBBS: ... with rising deficit...

MCKENNA: ... we are your biggest energy supplier. Most people don't realize that.

DOBBS: Did I mention, we love Canada?

MCKENNA: Oil, gas, everything.

DOBBS: You've got me convinced, Mr. Ambassador. Canada is, and has been, and I'm sure will always be, a great friend of the United States.

What is your reaction, though, when people talk -- we have 3 million -- an estimated 3 million illegal aliens crossing the border to the south. The idea that the economy somehow of Mexico, Canada, the United States, combined as a brilliant idea that will just extend the three-nation border and call that the North America, the recent recommendation of the Council on Foreign Relations. What do you think of that idea, which will just simply diminish our sovereignty and elbow up to one another, and call it a day?

MCKENNA: Well, that's not the position of the three governments. The three governments have their own plan, which was formulated down in Waco, and it consists of a lot of incremental changes. But nothing in the nature of the ambitious project that was anticipated.

But having said that, we do work together very closely at strengthening the border and making sure that commerce continues to flow. The relationship is strong. It's robust. But it doesn't -- it doesn't create a perimeter such as being discussed.

DOBBS: And let's -- I was stunned the other night, aghast, a Texas state senator here just threw it out, and I was so stunned I didn't even react. He said that, you know, when I was talking about improving border security with Mexico, he said, you know, we should be more concerned about Canada because that's where the 9/11 hijackers came from.

That's one of those myths that has grown up amongst even elected officials.

MCKENNA: It has, Lou. And it hurts us terribly, you know, because none of the 9/11 hijackers came from Canada. All 19 were legally present in the United States.

But you know, the reason it hurts...

DOBBS: Well, they weren't legally present.

MCKENNA: Right. But they were -- they were present. But I guess what hurts us is that we would never want to contribute in any way to anything that would harm our neighbor. The United States is our only neighbor, you know. And we take it very seriously that -- the security. We take our own security very seriously, because we're also on the al Qaeda hit list, and we want to protect Canadians.

DOBBS: Right. Ambassador Frank McKenna, we thank you for being here. We hope you'll come back.

MCKENNA: Thank you, I will.

DOBBS: And we look forward to talking to the ambassador from Mexico about many of the same issues.

MCKENNA: Thank you. Thank you.

DOBBS: Coming up here at the top of the hour on CNN, ANDERSON COOPER 360. Anderson with a preview. Tell us about it.

ANDERSON COOPER, HOST, ANDERSON COOPER 360: Lou, thanks very much.

Yeah, about 10 minutes from now, new developments in the search for Natalee Holloway in Aruba. Authorities have now cordoned off a specific area near the beachfront hotel where Holloway was staying when she disappeared. And while that search continues, so does the partying by American teens on Aruba.

Tonight on 360, we follow a group of teenage girls and guys as they go out for a night on the town. It is a shocking look at what American kids are still doing on Aruba. The precautions these teens are taking and not taking in light of Natalee's disappearance, something every parent should see.

All that and more at the top of the hour.

Lou.

DOBBS: Thank you very much, Anderson.

Imagine winning a million in the lottery. Imagine winning again. It's a 419 million to one chance, but that's exactly what happened to Pennsylvania's Donna Goeppert. She won $1 million playing a Pennsylvania lottery scratch-off game just five months ago; now she has won another million playing the very same game.

(BEGIN VIDEO CLIP)

DONNA GOEPPERT, WON LOTTERY TWICE: Feels fantastic. I'm still on a cloud. I don't feel like a millionaire; I just feel at ease now.

(END VIDEO CLIP)

DOBBS: In all, Donna Goeppert has won about $1.5 million after taxes. And I have a mother who loves to play those things. I hope it's not going to cost any more as a result of her good fortune.

Coming up next, the author of an explosive new book says Iran has been sheltering al Qaeda terrorists, including Osama bin Laden. He's our guest. He accuses the United States intelligence community of being willfully blind to the grave threat that Iran now poses to the United States. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight, we turn to the upcoming elections in Iran, what it means for international security. The current front-runner in Iran's election is Akbar Hashemi Rafsanjani, telling CNN in an exclusive interview today that Iran's nuclear enrichment program is purely peaceful.

(BEGIN VIDEO CLIP)

AKBAR HASHEMI RAFSANJANI, IRANIAN PRESIDENTIAL CANDIDATE (through translator): There is no reason for us to concede anything. We have nothing to hide. This is our right, our inalienable right.

(END VIDEO CLIP)

DOBBS: Rafsanjani denied that Iran is supporting terrorism or giving safe haven to known al Qaeda operatives. My guest tonight is Kenneth Timmerman. He vigorously disagrees with Rafsanjani. Timmerman is an investigative journalist, the author of "Countdown to Crisis: The Coming Nuclear Showdown with Iran," asserting the current regime is actively supporting al Qaeda and represents a clear and present danger to the United States. And good to have you here.

KENNETH TIMMERMAN, AUTHOR, "COUNTDOWN TO CRISIS": Thanks for having me, Lou.

DOBBS: These are strong claims. You not only suggest that they pose a clear danger to the United States, but Osama bin Laden is being harbored in Iran?

TIMMERMAN: Yes. And I've got to just tell you briefly my sources on this. I've worked as an investigative reporter, and I've spent many, many years debriefing Iranian defectors. These are people who have had positions in Iranian intelligence organizations. They've come out as patriots, bringing information about what's going on inside the regime. So I'm trying to tell the inside story, instead of the story that we get here from the United States from the outside.

DOBBS: 9/11 Commission member John Lehman endorses your book strongly, and pointing to the failures of the intelligence community. Did other members of the intelligence -- the 9/11 Commission review any of your sources and your work?

TIMMERMAN: I did speak with other members of the commission, people who were involved in the commission. One of the extraordinary stories that I uncovered in this investigation was that the CIA had been holding back information about Iran's involvement with al Qaeda. In fact, they had extensive information.

DOBBS: Before 9/11?

TIMMERMAN: Before 9/11, yes. They had extensive information about the coordination between the Iranian regime and al Qaeda, and indeed in the planning phase of the 9/11 attacks. And I tell that story in this book.

DOBBS: The Iranian nuclear facilities, Rafsanjani says, despite contrary evidence as focused on by this administration, that their need for nuclear fuels is purely peaceful?

TIMMERMAN: A very expensive play toy. Iran does not need nuclear fuel. They flare so much gas they could heat the entire region with what they just burn off into the air. The facilities they've built are exactly what they need for a nuclear weapons program.

DOBBS: The CIA, we talked to -- with them today. They declined to talk to -- to comment on your claims. Any thoughts?

TIMMERMAN: I'm not surprised. The CIA has rejected defectors. They're not able to sort out the true from the falsehood. I spent an awful lot of time doing this. You'll read about the defectors yourself in the book. I think people can make their own judgments.

DOBBS: Kenneth Timmerman, thanks for being here.

Still ahead, the results of our poll. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Now, the results of our poll. Do you think Microsoft is wrong to exclude certain words in its China-based Web portal deemed taboo by communist authorities? Seventy-two percent of you voting yes, 28 percent no.

Thanks for being with us here tonight. Tomorrow, Senator Maria Cantwell joins me. She has a plan to slash our dependence on foreign oil by almost half in just two decades. She'll be here to tell us about that. She will be among all of our guests.

For all of us here, happy Flag Day, and good night from New York. ANDERSON COOPER 360 starts right now.

Anderson.

COOPER: Lou, thanks very much.

END

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