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LOU DOBBS TONIGHT

Democrats Find It Difficult to Filibuster Supreme Courn Nominee Alito; Roadside Bombs a Constant Threat for U.S. Troops in Iraq; New Discoveries in the Able Danger Case

Aired January 30, 2006 - 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 a major defeat for Democrats in the battle over Supreme Court nominee Judge Samuel Alito one day before the president's State of the Union speech. We're live at the White House in Capitol Hill with our coverage. And I'll be talking with one of this country's most distinguished presidential historians.
And then, where is the good news from Iraq? Another American soldier killed by a roadside bomb. The number of roadside bomb attacks on Iraq nearly doubling last year. We'll be live in Baghdad with the latest.

And new development in the Able Danger controversy. Whether the federal government could have stopped the 9/11 hijackers before September 11th. My guest tonight, an award winning investigative journalist. We'll have those stories and much more ahead.

We begin with a political victory for President Bush and a defeat for liberal senators, who inexplicably chose a political battle they could not possibly win. The Senate today voted to end the debate on whether or not to confirm Judge Samuel Alito to the Supreme Court.

The Senate's decision is a severe blow to Democrats, such as senators John Kerry, Ted Kennedy, and Hillary Clinton. A final confirmation vote for Judge Alito is expected tomorrow, just hours before President Bush delivers his State of the Union address. Ed Henry reports from Capitol Hill.

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Lou, Judge Alito needed 60 votes to break this Democratic filibuster. He got that and then some, some 72 votes altogether. Twenty-five, only 25 votes for Kerry and Kennedy to keep the filibuster going.

As you say, he's now poised for confirmation Tuesday morning at 11:00 a.m. In addition to the 55 Republicans who voted to break the filibuster, there were 17 Democrats breaking ranks with Kennedy, Kerry, Clinton, and others. On that list of 17 Democrats, primarily moderate Democrats from so-called red states that President Bush carried in the last election. They're fearful this filibuster could backfire politically in the midterm elections.

Kerry piled ahead, believing it could rally the Democratic base heading into the midterm elections. Also could possibly help him in the 2008 campaign. The final blow, though, to Kerry's filibuster came today, just less than an hour before the actual vote when the Gang of 14 moderates met and basically said they did not believe there were extraordinary circumstances here to justify a filibuster of Judge Alito.

Kerry and Kennedy, though, plowed ahead amid Republican resistance. Republicans saying that they were basically assailing the character of a clearly qualified judge who should become the next justice. Take a listen to some of the passionate debate on the Senate floor.

(BEGIN VIDEO CLIP)

SEN. TED KENNEDY (D), MASSACHUSETTS: The '65 act for voting, voting rights. '68 act, the public accomodations. The 1973 act to say that women are going be treated equally. The Americans of the disability act that said the disabled are going to be part of the American family. All of that is the march to progress. And, my friends, the one organization, the one institution that protects it, is the Supreme Court of the United States.

SEN. PETE DOMENICI (R-NM), SENATE ENERGY COMMITTEE CHAIRMAN: This has turned into nothing more than a political war. Those who are going to vote to continue debate, many of them know that this man is as qualified as anyone we're going to get.

(END VIDEO CLIP)

HENRY: Now that this procedural hurdle has been cleared, there'll be a second vote Tuesday at 11:00 a.m. where Judge Alito is poised to become Justice Alito, the 110th associate justice on the Supreme Court. In fact, he may be even sworn in, in time to be in the audience tomorrow night at the State of the Union -- Lou?

DOBBS: Ed, thank you very much. As Ed Henry just reported, the White House wants the Senate to confirm Alito before the president's State of the Union address.

Today, President Bush said his speech will focus on issues such as energy, health care, and education. President Bush hoping the speech will lift his poor poll numbers. Dana Bash reports from the White House.

(BEGIN VIDEOTAPE)

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: To hear President Bush preview his address, it sounds like standard stuff.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I can't tell you how upbeat I am about our future.

BASH: But for a president at the bottom of a steep political hill, making people feel more confident about the country's direction is crucial. Americans feel bad and blame him and his party. A stunning 62 percent of Americans say they are not satisfied with the way things are going in the U.S. And 64 percent say things have gotten worse since Mr. Bush took office. JOHN PODESTA, PRESIDENT, CENTER FOR AMERICAN PROGRESS: He needs to find a way to get his message through that he's got a plan to get the country moving in the right direction again. And I think those are very daunting numbers that he's facing.

BASH: Bush aides say the president plans it use his fifth State of the Union to send a message he's worried about what most Americans are. So he'll highlight what one senior official calls kitchen table issues like gas prices back on the rise and massive sticker shock over home heating bills. There, the president will propose long-term initiates, promoting alternative energy.

And Mr. Bush will take on what critics say he's largely ignored for five years, American distress over skyrocketing health care costs.

DAN BARTLETT, COUNSELOR TO THE PRESIDENT: The big companies have all the tax advantages and breaks in order to provide health care. But if you're a mom and pop shop who has one or two employees, which the vast majority of all of the businesses, the jobs created in America are created by small businesses, they don't enjoy those same type of advantage and they should.

BASH: To that end, Bush aides say he'll propose personal tax deductions for medical expenses, so-called portability, making it easier to transfer insurance from job to job, allowing people to put more money in health savings accounts.

BUSH: We recognize we can't just sit back and hope for the best, that we've got to lead.

BASH: The president's aides say a major new theme in this year's address is maintaining America's leadership and competitive edge around the world, with a series of initiatives aimed at education, job training, and promoting innovation.

(END VIDEOTAPE)

BASH: Another key factor dragging down American's confidence in the direction of the country is the intense partisanship here in Washington. And the president said today he will use the State of the Union to call to elevate the tone in Washington. That is something the Democrats are welcoming. But still, they say that Mr. Bush and this White House is perhaps the reason, they were the cause for some of the decisiveness over the past five years -- Lou?

DOBBS: Dana, thank you. Dana Bash from the White House.

The Bush administration tonight is scrambling to rebuild its Middle East policy after it, the European Union, and Israeli intelligence agencies failed to foresee the Hamas win. Kitty Pilgrim reports.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT: Condoleezza Rice admits being stunned with the outcome of the Palestinian elections, saying, "I've asked why nobody saw it coming." But the president was clear at a cabinet meeting about the impact of a Hamas victory.

BUSH: Hamas Party has made it clear that they do not support the right of Israel to exist. And I have made it clear so long as that's their policy, that we will not support a Palestinian government made up of Hamas.

PILGRIM: The United States has given more than $1.5 billion to the Palestinian authorities in aid over the last 12 years. Total assistance from all sources, $1 billion a year. If the U.S. doesn't pay, Hamas may look elsewhere for cash.

QUESTION: There had been some talk that Iran and other countries, possibly Syria and others, would be putting vast amounts of both military weaponry and arms into Palestinian areas and tilting the whole dynamic there. Do you see that as a problem, and have you spoken to other governments concerning that?

ADAM ERELI, DEPUTY STATE DEPARTMENT SPOKESMAN: I'd say that that's, at this point, in the realm of speculative, and I don't want to go there.

BASH: Today in London, world leaders, the so-called quartet, the United States, Russia, European Union, and the United Nations, insisted Hamas change its charter and renounce violence.

JACK STRAW, BRITISH FOREIGN SECRETARY: There is a big choice now for Hamas as an organization, for elections and democracy entail responsibility.

PILGRIM: Secretary Rice today pointed out the fundamental contradiction with Hamas.

CONDOLEEZZA RICE, U.S. SECRETARY OF STATE: You can't be, on the one hand, dedicated to peace, and on the other hand dedicated to violence. It's simply -- those two are irreconcilable.

(END VIDEOTAPE)

PILGRIM: Well, today, Secretary Rice said the White House will watch Hamas' action going forward. But about the surprise Hamas victory, she said well, "Well, it does say something about us not having a good enough pulse" -- Lou?

DOBBS: That is an extraordinary reaction from the secretary of state. The intelligence agencies of this country, the State Department of this government, should absolutely be embarrassed beyond belief. And this president and this administration to tolerate continued intelligence failures, in this case political intelligence, is inexcusable.

PILGRIM: You cannot believe that regional experts would drop the ball on this one. And if we don't have good regional experts in the Middle East, there is a real problem.

DOBBS: Especially when we're putting so many American lives at risk in Iraq pushing forward a policy of democratization and apparently don't even have an understanding of what happening in the focal point of Middle East conflict. Kitty Pilgrim, thank you very much.

The Arab television network Al Jazeera today aired a new videotape of Osama bin Laden's number two, Ayman al-Zawahiri. This is the first videotape of al-Zawahiri since a U.S. air strike failed to kill him in a remote Pakistani village more than two weeks ago. As he has done before, al-Zawahiri threatened to launch more attacks on Americans on U.S. soil.

Insurgents in Iraq have killed another American soldier with a roadside bomb; 2,241 of our troops have now been killed since this war began. Roadside bombs, or IEDs, are the sergeant's deadliest weapon. Aneesh Raman in Baghdad reports on the escalating threat to our troops from those bombs. Chris Burns in Landstuhl, Germany, reporting on the condition of ABC journalist Bob Woodruff and Doug Vogt, who were wounded in a roadside bomb attack in Iraq.

We turn to Aneesh Raman first -- Aneesh?

ANEESH RAMAN, CNN CORRESPONDENT: Lou, good evening. These IEDs remain by far the biggest killer of U.S. forces in Iraq. The military says the number of IED attacks from 2004 to 2005 nearly doubled to 10,953. Now, that includes both IEDs that are detonated as well as those that were found and diffused.

They also become more sophisticate. We're told, Lou, that some of them can actually pierce through U.S. armored vehicles. They range from that to the more basic ones that are just some wires, some batteries, and artillery rounds. Officials have suggested some of the weaponry for these IEDs is in fact crossing Iraq's border from the country's neighbors, including Iran.

Now, while the number of IED attacks is the rise, Lou, the number of U.S. casualties is actually going down. The reason for that, we're told, U.S. troops are getting better training on IEDs before they come into Iraq. They're also getting better equipment to detect them.

But it is an exhaustingly dangerous experience. I've been out with U.S. forces on some of the country's most dangerous road. They find IEDs and within hours, new ones are placed in that some exact same spot. They're subtly hidden in piles of trash, in the body of dead animals. At time, they're hidden underneath the road itself, detonating by pressurized plates.

So any travel by U.S. forces is incredibly dangerous, for them, as well as for Iraqi security forces, who are the prime target of this country's insurgents. They, by and large, don't have the necessary equipment and armor yet, we're told, simply because there isn't enough to go around.

Some other numbers, Lou, to tell it you about. The U.S. military says last year, there were over 34,000 attacks throughout Iraq. They also say the number of suicide car bombs more than tripled between 2004 and 2005. And the number of suicide bombers using explosives vest, Lou, was seven in 2004, it was 67 in 2005. DOBBS: Aneesh, you mentioned that the American casualties at least have gone down despite the almost doubling of those roadside bomb attacks. What about the Iraqi casualties?

RAMAN: They've gone up. They are the prime target, Lou, of Iraq's insurgency. And a lot of these IEDs are remotely detonated. And they're done so just as Iraq's police force is driving by, other member of Iraq's army. Some of the police force is traveling around the country in simply white pick-up trucks that are completely unarmored.

Now, there are any number of reasons that. We're told, again, that there isn't enough armored vehicles to go around. There are also many reports on the ground of corruption at the top of Iraq's security forces. The money simply not trickling down to the front lines.

DOBBS: Aneesh Raman from Baghdad, thank you.

ABC anchor Bob Woodruff and his cameraman Doug Vogt could be transferred to a hospital in this country as soon as tomorrow. U.S. military doctors in Germany say both men have shown signs of improvement. Chris Burns reports now from Landstuhl, Germany.

(BEGIN VIDEOTAPE)

CHRIS BURNS, CNN CORRESPONDENT: At Landstuhl U.S. Military Hospital, two more cases that are all too common here, victims of a roadside bomb in Iraq. ABC news anchorman Bob Woodruff and his Emmy- winning cameraman Doug Vogt arrived here with breathing tubes and heavily sedated.

They're suffering from head wounds and broken bones after Sunday's blast in which a so-called improvised explosive device blew up outside the Iraqi military vehicle they were driving in. Standing in the open hatch, they were hit by shrapnel and whatever else the bomb kicked up, despite their body armor and helmets.

LT. COL. GUILLERMO TELLES, CHIEF SURGEON, LANDSTUHL MEDICAL CENTER: These that are foreign bodies that can cause tremendous amount of injury to flesh and bones.

BURNS (on-camera) So you've seen this pretty often then?

TELLES: Unfortunately, yes.

BURNS: After U.S. military doctors operated them in Iraq, they underwent CAT scans and other testing here. The hospital says doctors saw good, early sign of reaction, signs of slow improvement. Thousands of American troops have gone through this medical center, the biggest of its kind outside the U.S. Each soldier a tragedy for at least one family.

(END VIDEOTAPE)

BURNS: Two more casualties among thousands of American casualties out of Iraq. But one of them, one of these two, was beamed across American televisions, millions of them across America every night. Makes it even more real that Iraq remains a dangerous and violent place -- Lou?

DOBBS: As if we needed any reminder that our troops are in harm's way. Thank you very much.

Still ahead, new terrorist concerns on our broken border with Mexico. Terrorists may be trying to cross into this country with explosives, and it doesn't help that several government agencies can't seem to get their stories straight. We'll have that special report.

And new developments in the investigation into one of the most sophisticated border tunnels ever found. We'll have the very latest for you.

And the Reverend Jesse Jackson joins me. He says he is outraged by what he has experienced in New Orleans, firms knowingly hiring illegal aliens without concern for hiring resident. He's our guest here next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight, an alarming new warning about our broken borders, our lack of border security, and a terrorist threat to our country. Homeland Security officials say a group of Mexican nationals may be plotting to cross into the United States illegally and deliver plastic explosives to a terrorist. Casey Wian reports from Yuma, Arizona.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT: LOU DOBBS TONIGHT has obtained an internal Department of Homeland Security intelligence alert warning potential shoe bombers may attempt entry through the United States through Mexico. According to the alert, five Mexican nationals would attempt entry on foot with an unknown quantity of plastic explosives.

Those explosives would be hidden in the soles of their shoes. The alert says the source is of unknown reliability, and that the group is headed to San Francisco, where it intends to sell explosives to an unknown Iraqi national.

The Department of Homeland Security says the information is of, quote, "extremely low credibility," and that DHS receives information and sends alerts like this several times a day because it is, quote, "our responsibility anytime there is intelligence information, credible or not."

A DHS spokesman also says if the threat were deemed credible, the agency would notify local law enforcement, which in this case it has not. That approach angers the Minuteman Project. The head the group of concerned citizens monitoring our borders says it's like having a police force that you complain to time and time again, and they say, "Don't worry about it. It's probably an overrated threat."

Michael Cutler spent 30 years on border enforcement for the government, and says this is the latest evidence that our porous borders are a continued threat to national security.

MICHAEL CUTLER, FORMER INS OFFICIAL: Well, I think that they're obviously concerned, or they wouldn't be wasting people's time with it. That's not to say that every time you get an allegation, it's valid. But if this is a valid concern, think about the ramifications.

WIAN: The alert also issued a picture of what may be one of the Mexican nationals involved in the plan. That photo was taken during a prior arrest in Arizona 10 years ago.

Casey Wian, CNN, Yuma, Arizona.

(END VIDEOTAPE)

DOBBS: Other federal law enforcement agencies are in investigating this threat as well. Kelli Arena joins us now with the very latest on that part of the story -- Kelli?

KELLI ARENA, CNN CORRESPONDENT: Well, Lou, that alert went out two weeks ago. Government officials say that since then, the source of the information, the person was given a polygraph, which he failed. They also say that the information that he provided was thoroughly vetted, but it didn't pan out.

So officials say they could not corroborate anything he said. Bottom line, they say that this threat is a very low credibility, Wolf. Lou, sorry.

DOBBS: That's all right, Kelli.

ARENA: I'm losing my mind.

DOBBS: The question is really why this wasn't communicated to the Department of Homeland Security. Secondly, why there isn't a solid base of knowledge and analysis before these communications are made.

ARENA: Lou, this is described as an early warning notice that goes out. Homeland Security spokesman Russ Knocke says that, as you heard reported by Casey, this kind information comes in all the time. Homeland pushes out alerts like these several times a day, whether or not the intelligence is credible. And then it's shared with relevant law enforcement agencies because, they argue, Homeland Security, that that's the responsible thing to do.

Now, I can tell you, many counter-terrorism officials say they are inundated daily with information like this, and it's very difficult for them to prioritize. But even they say...

DOBBS: Difficult is probably not a word we care about when it comes to national security.

ARENA: Well, this is true, but they say they understand.

DOBBS: The second part of that, Kelli, I would like to ask you is, has there been, in the judgment of the Justice Department, a credible specific threat since 9/11 that they've communicated?

ARENA: Well, there have been, as you know, general intelligence about Al Qaeda's intent to...

DOBBS: No, no, no. I was being very specific there for a reason.

ARENA: No, there's no specific or credible information to support that Al Qaeda is in the process of plotting an attack against the United States. There is a lot of general sensitive intelligence that has come in showing their continued intent to do that and a specific concern about weapons of mass destruction, Lou.

DOBBS: Absolutely. Kelli Arena, I thank you very much.

ARENA: I welcome you.

DOBBS: Coming up next, why Google executives will be a congressional no-show this week in the China censorship investigation this week.

And new charges tonight. U.S. construction firms actively hiring illegal alien workers in New Orleans. It has outraged many. It looks like, to many, a plan. We'll have that special report. I'll be talking with the Reverend Jesse Jackson here next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The jury has been selected in the trial of former Enron top executives Ken Lay and Jeff Skilling, more than four years after the collapse of their energy trading firm. Opening arguments are expected to begin tomorrow. Ken Lay, who faces up 30 years in prison on fraud charges, says he's ready for the trial. It's expected to last more than four months.

(BEGIN VIDEO CLIP)

KENNETH LAY, FORMER ENRON CHAIRMAN & CEO: I'm feeling fine. All we're hoping for today is to take a fair jury and give me a fair shake.

(END VIDEO CLIP)

DOBBS: Lawyers for both Skilling and Lay tried and failed to this trial moved out of Houston, saying there is no way their clients can get a fair trial in Enron's home town.

Three top Enron executives have already pleaded guilty in case, which also led to the collapse of Enron accountant Arthur Andersen. The Supreme Court later overturned Anderson's obstruction of justice conviction in the case and not one single Andersen employee was ever convicted of a crime and sent to jail; 85,000 Arthur Andersen employees lost their jobs.

Tonight, executives from both Google and Microsoft have decided to not attend a congressional hearing this week into communist Chinese censorship. The Congressional Human Rights caucus holds hearings Wednesday into how U.S. Internet firms are collaborating with the Chinese government to censure freedom of speech. Google says no one from its organization would be able to attend. It will send, however, a statement.

Take a look now at some of your thoughts. Michael in California said, "Are American workers unskilled? It's not a matter of skilled or unskilled. It's hard to compete with 29 cents an hour wages that the average Chinese worker makes on the assembly lines. It's not about skilled workers, it's about cheap workers. The once-strong middle class will soon be but a footnote in the history books made in China.

Harry in Alaska: "Lou, with grandchildren in school, I'm not sure whether to advice them to learn Spanish as a second language or Chinese."

Lance in Georgia: "It seems to me, Lou, before we start promoting democracy in far off lands, we ought to try to get it up and running again in our own country. It's been a long time since America has seen a government of the people, by the people, and for the people."

And Chris in Georgia: "Lou, I like your show, but I'm puzzled by your constant reference of the world's largest country as communist China. After all, we no longer hear capitalist America on Chinese newscasts. I share your concerns about this emerging superpower, but this labeling seems a bit bombastic and out of date."

Really? Chris, tell me now, when is the last time you remember any national newspaper in this country, magazine, or web page headline, or any television network or radio station refer to communist China as communist China?

Fact, Chris, China is a communist country. Fact, the reason our business, political, and media elites don't want you to hear the word or see the word communist may have something to do with our failed foreign policy, the hundreds of thousands of jobs outsourced to China, and the massive trade debt that this capitalist nation now owes that communist nation. Just something you might want to consider, Chris. I hope you will.

We love hearing from you. Send us your thoughts at Loudobbs.com. We'll have more of your thoughts later in the broadcast.

Still ahead, we'll be live on Capitol Hill with the very latest on the Judge Samuel Alito nomination and perspective confirmation.

Stunning charges tonight out of New Orleans about the individuals being hired to rebuild the devastated city.

And President Bush ready to go to battle with his fellow Republicans over what one of his administration officials call his unworkable guest worker program.

New developments in the Able Danger controversy as well, while Able Danger may have an organized crime connection. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The Senate tomorrow is expected to vote to confirm Judge Samuel Alito to the U.S. Supreme Court, just hours before President Bush's State of the Union address. Democratic senators such as John Kerry, Ted Kennedy, and Hillary Clinton, failed to win support for a filibuster. Ed Henry has the latest now from Capitol Hill -- Ed?

HENRY: Lou, Judge Alito needed 60 votes to break this Democratic filibuster. He got that and then some. Seventy-two votes in all. Only 25 votes for Kerry and Kennedy for their filibuster.

In addition to 55 Republicans, there were 17 Democrats who broke ranks with Kerry and Kennedy voting to cut off debate, end this filibuster. They were concerned this could backfire politically on Democrats in the midterm elections, looking like they're obstructing this nomination.

The final blow to Kerry's filibuster came today less than an hour before the Senate vote when the so-called gang of 14 moderates got together and basically said, they did not see any extraordinary circumstances to justify a filibuster.

A final confirmation vote coming tomorrow morning 11:00 a.m.-- Lou?

DOBBS: Ed Henry, is there any suggestion as to what the strategy was here? Because it was absolutely evident that they could not prevail. And it looks like more obstructionism without purpose.

HENRY: I tell you, a lot of Democrats up here are privately whispering in the hallways. They want an answer to that as well. What was the strategy?

They say look, if John Kerry had launched this filibuster a couple of weeks ago at the end of the hearings when Democrats were frustrated that they didn't get the answers that they wanted and a lot of lawmakers and especially on the Democratic side, some Republicans as well were undecided, this maybe could have worked. Maybe there would have been some momentum.

But to do it after basically just about everyone had decided where they were on this. It was clear Judge Alito the votes. It really did not seem to be a workable strategy. And in the end, it only got 25 votes. So I could tell you a lot of Democrats, not just Republican, but Democrats scratching their heads--Lou.

DOBBS: I would imagine especially Democrats.

Ed Henry, thank you very much from Capitol Hill.

There is growing evidence tonight that American citizens are being shut out of the effort to rebuild devastated New Orleans. American citizens, American workers who should be helping in the massive reconstruction effort are being passed over in favor of cheap foreign labor and a growing illegal alien work force.

Susan Roesgen reports.

(BEGIN VIDEOTAPE)

SUSAN ROESGEN, CNN CORRESPONDENT (voice over): This Shell station in New Orleans is a lot busier than it was before the hurricane even though most of the people in the parking lot these days aren't buying gas. They're day laborers, often several hundred a day and with the station owner's blessing they wait for contractors to pick them up.

When this red truck pulled in last week, we dove into the crowd to see who was hiring.

UNIDENTIFIED FEMALE: Come with me.

ROESGEN: Turns out the driver was a local woman who said she couldn't afford local labor to gut her flooded home. She had heard these guys were cheaper.

ELAINE WYLIE, HOMEOWNER: I understood that they came here with contractors who left them here.

ROESGEN (on-camera): Does that bother you that they might be in this country illegally?

WYLIE: It bothers me that they came to this -- the way they came to this country, but they're here and they have to eat.

ROESGEN (voice over): In fact, Elaine Wylie wound up hiring one local guy who saw an opportunity.

(on-camera): Sir, do you speak Spanish?

UNIDENTIFIED MALE: No.

ROESGEN: So what's your role here?

UNIDENTIFIED MALE: I'm just trying to get some work that's all. I just got back in town, you know, from the storm. And I just came out here. You know, I see all these guys around here. So I just came the first thing roll. I go with the punches.

ROESGEN (voice over): There is plenty of work to go around. Cole Cantrell supervises a crew cleaning air ducts. He says his company doesn't hire illegal immigrants but understands why some do.

COLE CANTRELL, CREW SUPERVISOR: I'm pretty much money. You know, they come in and do the job a lot cheaper than most around here.

ROESGEN: It's that cheap labor contractor Hector Pulles says he can't compete with.

HECTOR PULLES, CONTRACTOR: We have workman's comp. We have insurances we have to pay. We go by the letter of the law. And they have guys that are coming in, immigrating, from, you know, not even citizens of America. And they're coming over here, immigrating, and taking all of our work.

ROESGEN: Last month, U.S. Immigration and Customs Enforcement arrested 19 illegal immigrants at this Shell station, but a spokeswoman for the agency says going after contractors who hire illegals is tougher to do because in many cases, there's no paper trail to chase. Hector Pulles agrees.

PULLES: There has to be greater accountability with the state licensed contractors here. Someone has to put their names on the line.

ROESGEN: Pulles says the only way he and contractors like him are going to be able to stay in business and hire local workers is if the people who need this work done are willing to pay more to help the city rebuild.

Susan Roesgen, CNN, New Orleans.

(END VIDEOTAPE)

DOBBS: Reverend Jesse Jackson joins me tonight from New Orleans. He says American contractors appear to be hiring illegal aliens in New Orleans on a massive scale.

Jesse, it is good to have you here. What is going on? I mean, is this simply a question of demand outstripping a supply, a supply in this case of American workers?

REV. JESSE JACKSON, RAINBOW-PUSH COALITION: There's a profound population shift. The Latino population was 3 percent. It's now 20 percent, and it's not just South Central Latin America. It's also east and Europeans as well.

They have been trafficked in and their cheap labor has been used while businesses are still locked out. So you have outside workers displacing New Orleans citizens and outside no-bid contractors displacing Katrina areas citizens.

DOBBS: What would you -- at this point, is this a conspiracy of circumstance, the devastation that the failed New Orleans and the displacement of hundreds of thousands of New Orleans residents who can't get back? Give us your thought.

JACKSON: Well, number one, these workers are not just coming across the border, they're being sent for, brought in and hired. They've been trafficked in often working on the very exposing condition without of course any health insurance.

What must be clear--made clear by our government is that those who have been displaced have the right to return home. The purpose is on jobs, job contracts and that precedent has not been established.

That's why we're going to have a massive demonstration on April 1st demanding that these citizens, white, black and brown, whether Mississippi, Alabama, Louisiana, have the right to return with preferences on jobs and contracts. Right now that's not established and being honored.

DOBBS: Well, the citizens, the residents of New Orleans who were displaced in many cases don't have a way to get back to New Orleans. In many cases people don't -- city governments, local federal and state government don't even know how to reach them.

Is it your sense that this administration, the Bush administration, is simply made it absolutely a matter of ease and convenience to bring in illegal labor, undercut American labor and simply disregard those displaced workers?

JACKSON: Absolutely. They are their own one way ticket. There was no plans that built for them temporary housing or affordable housing say within any reasonable distance.

For example, you have got unused military bases, Air Force base in Alexandria, the Belle Chase Base, Algiers base. People could be living there and close enough to come back and forth to work. There is no plan to bring them back.

Even on voting, Lou, at first they said FEMA would not give the list to the state attorney general. Now, FEMA has given the list to the state attorney general he will not give it to local officials. So they won't have any elections April 22nd and deny people who are in exile to have access to their officials. That's unconstitutional.

You cannot have any shift in voting access without violating section five of the Voting Rights Act. So really the law here has really been put on hold even in something as basic as the right to return and the right to vote.

DOBBS: Well, the law's been put on hold there, as you say, Reverend Jackson. The law is--I don't know if put on hold is the case, maybe just simply dispensed with in so many issues of both national security and illegal immigration in this country.

JACKSON: It is workers, national security and voting.

DOBBS: Jesse Jackson...

JACKSON: Workers, national security and voting.

DOBBS: Jesse Jackson, it is good to have you here. We appreciate it. Good luck.

JACKSON: Thank you very much.

DOBBS: In our poll tonight, we'd like to know which issues you think President Bush will address tomorrow evening in his State of the Union address.

Do you believe President Bush will, A. propose a comprehensive, immediate plan to secure our borders, B. propose a plan to create high paying middle class job, C. announce policies to cut our record budget deficit and trade deficit, D. announce policies to dramatically cut our dependency on foreign imports of energy, clothing, technology, automobiles and consumer electronics and perhaps capital, E. all of the above, F. none of the above?

Cast your votes at loudobbs.com. We'll have the results coming up here in the broadcast.

Still ahead, bad news from one of the largest food companies in country. We'll have that story.

And then the state of our union. President Bush preparing to address the nation at a time when most of us say his second term has been a failure. We will have our own State of the Union broadcast here tomorrow to give you our perspective on the state of this great union.

And presidential historian James Taranto will be my guest here next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: President Bush's State of the Union address comes amid some of the worst poll ratings of his presidency. The latest poll, an ABC News/"Washington Post" poll finds only 42 percent of Americans approve of the way the president is handling his job, 56 percent disapprove.

A CNN/"USA Today"/Gallup poll finds more than half of all Americans, almost six in 10, rate the president's second failure -- second term, a failure. The same poll finds only two-thirds of us, 64 percent, say the president has no clear plan for solving this country's problems.

The American people are not much happier with members of Congress, by the way. A "Los Angeles Times"/Bloomberg poll finds only 36 percent of Americans have a favorable opinion of congressional Democrats. A whopping 38 percent have a favorable opinion of congressional Republicans, that despite the Abramoff scandal.

Joining me now for more on State of the Union is presidential historian James Taranto. He's the editor of the "Wall Street Journal's" opinionjournal.com. James, it is good to have you here.

JAMES TARANTO, PRESIDENTIAL HISTORIAN: Good to be here, Lou.

DOBBS: It is -- as we look back over poll numbers for Clinton, for Reagan, this looks really, really bad.

TARANTO: Well, I don't know, Lou. I guess I'm one who doesn't place much stock in presidential approval ratings, especially in the second term.

DOBBS: So you're dismissing the polls, is that right, James?

TARANTO: Pretty much, yes.

DOBBS: OK, well -- for those of us, if you would just be so kind.

TARANTO: Of course.

DOBBS: For those of us who do pay attention and not knowing always what weight to give them, at least do compare them. Don't you think that the White House has to be extraordinarily animated in its concern?

TARANTO: I think it has to be animated in its concern about its ability to carry out its agenda for the rest the term. I don't know why it should be concerned with the poll numbers per se, because the president isn't going to run for re-election again.

DOBBS: No he isn't. But 435 members of Congress, most of them Republican, will -- a third of the Senate. And it looks like they could get -- I will put this in the kindest terms, they could get a shalacking based on the poll numbers that we're looking at in other areas.

TARANTO: Well, they could.

DOBBS: There I go with those poll numbers again, James.

TARANTO: You did. Although, if you look back, in 1986, the Republicans got a shalacking and President Reagan was doing quite well in the polls. In 1998, President Clinton was doing quite well in the polls and it was more or less a wash with the Democrats making some modest gains.

DOBBS: So, what do you make of a president who has put his entire second term on Social Security reform, democratization in the Middle East, a guest worker amnesty program on immigration -- has failed to secure our borders, dismissed the idea of the importance of a quality of life and standard of living for the middle class. Is there anything here that I'm missing?

TARANTO: Well I think in his State of the Union, my understanding is he's going it talk about some modest health care reforms. For example making it easier for people to buy their own health insurance outside of their employer. Right now we have the tax system, gives great benefits to employers.

DOBBS: Is that the kind of thing you would say to the president, you need to do? That's the kind of thing that you could step into the bully pulpit, Mr. President, in the time when we're getting our rear ends whipped in trade, when you talk about competitiveness. We're running up a $4 trillion external trade debt. Our deficits are skyrocketing and we're watching job creation of the most tepid sort. In a point of fact we're seeing wages decline.

TARANTO: I think at this point given what happened in 2005, my advice for the president would be to set his domestic goals fairly modestly. Remember a year ago, President Bush came out, he tackled one of the great problems facing this country, the Social Security crisis. He put forward a drastic proposal for reform. He didn't get many takers. I think the reality right now on Capitol Hill is that the Republicans have to be completely unified behind something because the Democrats aren't going to support anything less the Republicans get credit for something getting done. So political necessity just dictates that he has to be modest.

DOBBS: We'll see if modesty prevails tomorrow evening. James Taranto, thank you very much.

TARANTO: Thank you.

DOBBS: Be sure to join us here tomorrow evening for our special report before the president's State of the Union address. Our team of correspondents will be stationed throughout the country to find out the real State of our Union, if you will. A view from certainly outside the beltway with our search for an independent nonpartisan reality to share with you. We will, of course, also have reaction on the president's speech the following evening. Please join us for both.

And another major American firm announcing sweeping new job cuts today. Kraft Foods says it's cutting 8,000 jobs, closing 20 plants worldwide. That's on top of the more than 5,000 job cuts that Kraft announced last year. Kraft job cuts comes as the company reported a 23 percent rise in its quarterly profits.

A huge increase in profits at the world's largest oil company as well, surging to another record high. Exxon Mobil today reported its annual profit hit a staggering $36 billion last year. Those profits coming in the same year that Americans were paying record prices and near record prices for gasoline and home heating oil.

New evidence today that Americans are spending far more than they are earning. Government reports showing consumer spending in December rose at a rapid pace of nearly one percent. Americans financing much of their shopping by tapping into their savings. Many of those purchases are imported from overseas and the government says imports into this country in November were the second highest on record, nearly $175 billion.

While middle-class Americans are under siege, one American company is creating thousand of jobs and a cheap foreign labor market. Dell computers saying it will soon hire 5,000 people in India. Many of them will work at its new call center, Dell's fourth in India. These new hires will raise Dell's workforce in India to 15,000 folks.

Coming up at much to the hour here on CNN, THE SITUATION ROOM with Wolf Blitzer. Wolf, tell us all about it.

WOLF BLITZER, CNN ANCHOR: Thanks very much, Lou. We're following several stories, including the No. 2 man in al Qaeda. He has a new message today for President Bush and doesn't mince words.

Also Saddam Hussein threatens not to turn to his court for his trial. I'll speak to one of Saddam Hussein's lawyers, Ramsey Clark, the former U.S. attorney general here in THE SITUATION ROOM.

And CNN's own Dr. Sanjay Gupta joins me to talk about the road to recovery for ABC's Bob Woodruff and cameraman Doug Vogt. They've been seriously wounded in a roadside bombing in Iraq. All of that coming up, Lou, right at the top of the hour.

DOBBS: Look forward to it, Wolf, thank you. And just ahead on this broadcast, we'll have your thoughts on Mexico's incursions across our border. The administration's thoughts -- we'll tell you about as well.

Then, new information about the secret intelligent project that identified the 9/11 hijackers before the attacks. Award-winning journalist Peter Lance joins me here next with the latest on Able Danger. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight, an organized crime investigation under way now in New York City could shed new light into the controversy over Able Danger and uncover new U.S. intelligence failures leading up to September 11.

Joining me now to discuss his findings, Emmy award winning journalist Peter Lance. He's the author on of the book "Cover Up," with an extensive examination of this investigation, now under way in Brooklyn as well. Peter, good to have you here. What's the connection between this case in Brooklyn and 91/1 and Able Danger?

PETER LANCE, INVESTIGATIVE JOURNALIST: Try to do it in three dots, OK. Dot number one, 1996, Ramsi Yusef, the original World Trade Center bomber. The man who I say is the architect of 9/11, he's in federal jail in lower Manhattan, awaiting trial. In the cell next to him, Gregory Scarpa Jr. Greg Scarpa Jr. is awaiting racketeering charges. He's a wise guy for the Colombo crime family.

DOBBS: A hit man.

LANCE: No, he sold marijuana. He was a relatively benign organized crime figure. RICO charges. Nothing heavy.

DOBBS: Minor item?

LANCE: Pardon me?

DOBBS: A minor item?

LANCE: Well, when you compare it to what he uncovered for this country it was amazing. What he did, Lou, over 11 month, he risked his life. Ramsi Yusef is passing him notes with extraordinary pieces of information about al Qaeda: admissions that there's an al Qaeda cell in New York City in 1996. Admissions they want to hijack a plane to free blind Sheikh Rahman, et cetera. And --

DOBBS: How could this tie to Able Danger. LANCE: Deitrick Snell (ph). Our friend, Detrick Snell. Detrick Snell is the prosecutor of Yusef in this upcoming case. He's the man that is privy to all of this intelligence and ultimately what happens is, because Scarpa Jr.'s father was involved in a relationship with an FBI agent named DeVecchio, and that's what the Brooklyn D.A. is looking into now, this alleged corrupt relationship.

The FBI and the Justice Department, I say, made an end's means decision. If they believed young Greg Jr for the intelligence about Yusef, he would be credible. And if he's credible in that case, he will be credible when he went to expose later on, his father and this corrupt FBI agent. And therefore, they made an end's means decision. Let's flush this intelligence on al Qaeda so we can preserve 60 mob cases in the Eastern District in Brooklyn.

DOBBS: So that's the reason you think they basically were discrediting?

LANCE: Absolutely. The proof of it is on my Web site peterlance.com, Lou, I have dozens of FBI 302 memos that prove the intelligence from Ramsey Yusef to Greg Scarpa in 1996, including --

DOBBS: Are we going it see much this much come out into you think in the Able Danger hearings or are we going to be focused otherwise?

LANCE: I believe Congressman Kurt Weldon.

DOBBS: The leading to the charge. Trying to get to the truth.

LANCE: And now his staff in particular sees the connection and the value in the Brooklyn's D.A.'s really courageous investigation.

DOBBS: Hearings which we have yet to learn when they will begin but nonetheless promised. Thank you very much, Peter Lance.

DOBBS: Thanks, Lou.

DOBBS: Appreciate it. Still ahead, the results of our poll. More of your thoughts. A preview on what we have coming up for you tomorrow on State of the Union address day. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Results of our poll tonight. Two percent of you say in his State of the Union address, President Bush will propose a comprehensive immediate plan to secure our borders. Zero percent responding that he would propose a plan to create high-paying middle class jobs. One percent saying he will announce policies to cut our record budget deficit and trade deficit. Six percent of you say he will announce policies to dramatically cut our dependency on foreign imports of energy, clothing, technology, automobiles and consumer electronics. Six percent of you said all the above, 88 percent of you said none of the above. We'll see what happens.

Well, here's some of your thoughts. Tom in Texas said, Lou, forget about the deficit, the loss of jobs, the health care crisis and broken borders. I'm glad our Congress is finally putting their foot down about iPods harming people's ears. It's about time we got to the important problems in our country. Couldn't agree more.

John in Illinois: "With the events of the last few week, it won't be long before the only thing we could buy that is truly American is an elected official.

And Jim in Washington: "I was disappointed this morning no one asked the president about the military incursions across our southern border. I'm sure that with his protecting so dutifully from the terrorists that keeping a foreign army out must be high his priority list.

And John in Florida. If George W. Bush would defend our borders as vigorously as he is defending his illegal wiretapping, maybe we could make some progress.

Patrick in Florida. Lou, I'm not too worried about the NSA surveillance. If it's as lousy as the other intelligence, what's the problem?

And Wayne in Texas. Do you know the main reason Vicente Fox does not want a fence along the border? The Mexican military can't get a humvee loaded with drugs over.

And John in Georgia. Dear Lou, Washington does seem to be waging war on the middle class. I suggest they take a look at what percentage of the federal budget comes from us. Careful, don't cut off the hand that feeds you.

And Terri (ph) in Michigan. Regarding the comments of the labor secretary about skills required for the so-called new economy, it seems the only skill required is how to survive on minimum wage.

And Bob if Florida. You thought we didn't have an energy policy. Well, here it is. Exxon sees record profits for any U.S. company.

We love hearing from you. Send yours thoughts at loudobbs.com. Each of you whose email is read here will receive a copy of my book, "Exporting America." And if you would like to receive our e-mail newsletter, sign up at loudobbs.com. Thanks for being with us tonight. Please join us here tomorrow for our special report ahead of the State of the Union address. Our team of correspondents here will be reporting from all across the country to offer you the real state of our union, a view, that is, from outside the beltway.

We'll also be joined by former presidential advisers David Gergen and Ed Rogers. Please be with us. For all of us here, thanks for watching. Good night from New York.

THE SITUATION ROOM starts right now with Wolf Blitzer. Wolf?

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