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LOU DOBBS TONIGHT

Alleged Plot to Attack New York City's Mass Transit System Foiled; President Bush Defends His Record on Global War on Terror; Possible Showdown in United Nations Security Council on North Korea; Out-Of-Control Violence on Mexican Border; Labor Department Reports Economy Added Only 121,000 Jobs in June; Santorum Hopes to Gain Political Ground by Making Illegal Immigration Number One Campaign Issue; Lieberman Versus Lamont

Aired July 7, 2006 - 18:00   ET

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


KITTY PILGRIM, CNN ANCHOR: Tonight, police and intelligence agencies smash a radical Islamist terror group. It was plotting to attack the mass transit system in New York City. The target was a subway tunnel under the Hudson River used by thousands of commuters.
ANNOUNCER: This is LOU DOBBS TONIGHT, news, debate and opinion for Friday, July 7th.

Sitting in for Lou Dobbs, Kitty Pilgrim.

PILGRIM: Good evening, everybody.

The FBI says the mastermind of a plot to bomb a tunnel in New York is in custody tonight in Beirut. The radical Islamist terrorist is one of three suspects being held overseas. Five other suspects are still at large. The FBI says the plot would have involved martyrdom and explosives.

Kelli Arena, in Washington, reports on what appears to be a major success in the global war on terror. And Mary Snow reports from New York on the threat to the city's mass transit system.

We begin with Kelli Arena -- Kelli.

KELLI ARENA, CNN JUSTICE CORRESPONDENT: Kitty, Homeland Security Secretary Michael Chertoff today said that officials were all over this plot before anyone was even close to being put in danger.

(BEGIN VIDEOTAPE)

ARENA (voice-over): Government officials say the plot to blow up path tunnels in New York City came to their attention about a year ago. It was in the early stages, but officials say quickly maturing with the aim of attacking this fall.

MARK MERSHON, NEW YORK FBI ASSISTANT DIRECTOR: They were about to go to a phase attempt to surveil targets, establish a regimen of attack, and acquire the resources necessary to effectuate the attacks.

ARENA: With the alleged mastermind in custody in Beirut, officials went out of their way to say the threat has been neutralized.

Assem Hammoud is a 31-year-old Lebanese national.

MERSHON: We know that he has acknowledged pledging a bayat (ph) or allegiance to Osama bin Laden, and he proclaims himself to be a member of al Qaeda.

ARENA: The FBI says eight individuals in total are involved. At least two other alleged participants are also in custody. But the FBI won't say where.

As for the other five, officials say they do not believe they are in the United States.

MERSHON: There are still subjects out there mostly known, some only partially identified or unknown. And we remain vigilant.

ARENA: The fact that this information got out when it did infuriated some officials who say it jeopardized the investigation. But even more damaging, they say, was the revelation the FBI discovered the plot by monitoring Internet chat rooms. That gets uncomfortably close to disclosing sources and methods.

PAT D'AMURO, FMR. ASSISTANT DIRECTION, FBI, NEW YORK: This is a situation where I think the information came out prematurely. And whoever leaked this information really needs to take a step back and take a look at what they were trying to accomplish.

(END VIDEOTAPE)

ARENA: Now, despite that leak, the investigation is still ongoing. The FBI says there are at least six countries actively involved, and sources tell CNN that those include Pakistan, Canada and Iraq -- Kitty.

PILGRIM: Thanks very much.

Kelli Arena.

New York Police Commissioner Raymond Kelly said extra police are guarding potential targets in New York City. He said New York remains very much in the crosshairs of the terrorists.

Mary Snow reports from Lower Manhattan -- Mary.

MARY SNOW, CNN CORRESPONDENT: Well, Kitty, the latest potential target, according to the FBI here in New York, is a tunnel carrying train commuters from New Jersey to Manhattan here every day, carrying about 215,000 commuters on the path system.

Now, coincidentally, the New York City police commissioner, Ray Kelly, said that he had ordered security to be stepped up, particularly at train stations, because of the one-year anniversary of the London bombing. And city officials are once again making their case to the federal government for more Homeland Security Department funding after a recent 40 percent cut to New York. (BEGIN VIDEO CLIP)

MAYOR MICHAEL BLOOMBERG (R), NEW YORK: This is just another example in a long line of them as to why we have to continue to keep our vigilance up and why, with homeland security funding, we can do that. Without that, this city is going to continue to do what it has to do, but the sacrifices on the part of the public are something they shouldn't bear. The American government should give out homeland security moneys based on risk.

(END VIDEO CLIP)

SNOW: Now, while the FBI specifically cited the path tunnel today, they did point out that all river crossings have been the subject of terrorist threats for the past several years -- Kitty.

PILGRIM: Mary, there were critical words from the FBI today about the leak of this story by "The New York Daily News."

How angry is the FBI about this?

SNOW: Well, you know, at today's press conference, the assistant director of the FBI here in New York, Mark Mershon, was visibly angry, calling the person who leaked this story "unprofessional behavior," in his words. And he said that it led to some uncomfortable questions from foreign service intelligence -- foreign intelligence services officers.

He said that the FBI has been trying to shore up some of these relationships. So he was clearly angry that this story got out.

PILGRIM: Thanks very much.

Mary Snow.

Well, a new terror warning in London today. This is exactly one year after the suicide bomb attacks on London's mass transit system. London's police chief, Ian Blair, said the threat remains very grim. He said terrorists are planning further atrocities.

Londoners today held ceremonies to remember the 52 people who were killed in the attacks a year ago. Nearly 800 people were wounded. Many of them seriously.

President Bush today strongly defended his record on the global war on terror, and he also challenged North Korea to end its nuclear weapons program and stop testing ballistic missiles.

Suzanne Malveaux traveled with the president, and she reports from Chicago.

(BEGIN VIDEOTAPE)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It's nice to be here in Chicago. SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT (voice-over): President Bush blew into the Windy City to hold his first solo news conference outside of Washington, part of a new media strategy to show a president in touch with the people, taking questions from local reporters. But the hour-long session was dominated by questions about North Korea.

Since the missiles were launched two days ago, Mr. Bush has been trying to get North Korea's neighbors to unite, and convincing the regime to come back to the stalled six-party talks, and for them to agree on sanctions.

BUSH: It's slow and cumbersome. Things just don't happen overnight.

MALVEAUX (on camera): If I could follow up, you say diplomacy takes time.

BUSH: Yes, it does.

MALVEAUX: But it was four years ago that you labeled North Korea a member of the axis of evil. And since then, it's increased its nuclear arsenal, it's abandoned six-party talks, and now these missile launches.

BUSH: Let me answer your question. It's increased -- that's an interesting statement, North Korea has increased its nuclear arsenal.

Can you verify that?

MALVEAUX: Well, intelligence sources say -- if you can -- if you would like to dispute it, that's fine.

BUSH: No, I'm not going to dispute it. I'm just curious.

MALVEAUX (voice-over): According to U.S. intelligence sources, North Korea had the capability to produce one to two nuclear weapons in the mid to late 1990s. But since it began reprocessing 8,000 spent fuel rods in April 2003, U.S. intelligence estimates North Korea can produce six to eight nuclear weapons, while other experts suggest as many as 12 or 13.

(on camera): Why shouldn't Americans see the U.S. policy regarding North Korea as a failed one? What...

BUSH: Because it takes time to get things done.

MALVEAUX: What objectives has the U.S. government achieved when it comes to North Korea? And why does the administration continue to go back to the same platform process if it's not effective in changing North Korea's behavior?

Thank you.

BUSH: Suzanne, these problems didn't arise overnight and they don't get solved overnight. It takes a while. You asked what we've done. We have created a framework that will be successful. I don't -- my judgment is, you can't be successful if the United States is sitting at the table alone with North Korea. You run out of options very quickly if that's the case.

(END VIDEOTAPE)

MALVEAUX: And the question now, of course, is whether or not President Bush has the credibility and the standing when he meets with world leaders at the G8 summit next week in Russia to convince them that he does have a winning strategy to convince North Korea to abandon its nuclear ambitions -- Kitty.

PILGRIM: Thanks very much.

Suzanne Malveaux.

Well, there could be a showdown in the United Nations Security Council tomorrow on North Korea. Japan, the United States and Europe want the council to support a resolution that threatens North Korea with international sanctions. But Russia and communist China strongly oppose any sanctions.

Richard Roth reports from the United Nations.

(BEGIN VIDEOTAPE)

RICHARD ROTH, CNN SR. U.N. CORRESPONDENT (voice-over): North Korea's U.N. ambassador calmly arrived for work. A block away, the pace was more urgent for ambassadors on the U.N. Security Council, still grappling for ways to react to Pyongyang's missile message.

The five most powerful nations with veto rights on the council began the day huddling with the Japanese at the U.S. mission. Despite objections from China and Russia, the U.S. and its allies kept the threat of sanctions in the latest draft resolution.

EMYR JONES PERRY, BRITISH AMBASSADOR TO U.N.: I think you'll find that the text is technically improved on the text that was on the table, but it's substantially unchanged.

ROTH: Not enough change to suit China.

WANG GUANGYA, CHINESE AMBASSADOR TO U.N.: I think it's -- certainly I think the resolution might have negative reactions from the region.

ROTH: Though President Bush cautioned again that diplomacy takes time, the U.S. and Japan pressed for a vote on the North Korea resolution as early as Saturday.

KENZO OSHIMA, JAPANESE AMBASSADOR TO U.N.: Hopefully -- hopefully, of course, there will be unanimous decision. But if that is not the case, then other ways will have to be followed.

ROTH: It's showdown diplomacy, calling for a vote but risking a possible veto of the resolution by China and Russia.

JEAN MARC DE LA SABLIERE, FRENCH AMBASSADOR TO U.N.: I think that it is not -- nobody could expect -- and I hope not. I very much hope that they will not vote no on the resolution.

ROTH: North Korea has threatened retaliation for any tough Security Council action.

JOHN BOLTON, U.S. AMBASSADOR TO U.N.: The principal tactic that we're pursuing at the moment is clearly diplomatic. We're not engaging in flights of rhetoric, nor are we launching missiles.

(END VIDEOTAPE)

ROTH: Since a Chinese delegation is going to North Korea to talk next week, there may not be a vote next weekend. Talks are under way right now, Kitty, at the United States mission at the U.N.

PILGRIM: Thanks very much.

Richard Roth.

Well, in Iraq, insurgents have killed two or more of our troops. The soldiers died of wounds they received in combat.

2,539 of our troops have been killed in Iraq since the war began.

U.S. and Iraqi troops today arrested an insurgent leader in the Sadr City area of Baghdad. The troops met heavy resistance as they tried to arrest the insurgent. The soldiers killed at least 30 gunmen, and there were no U.S. or Iraqi military casualties.

Still to come, alarming testimony today about the terrorist threat to this country on our southern border.

Also, Senator Joe Lieberman declares, "I'm not George Bush," as he fights for his political life.

We're live in Connecticut for that.

And President Bush defends his economic record as middle class Americans face an outright war on their standard of living.

(COMMERCIAL BREAK)

PILGRIM: Congress today heard alarming stories about the out-of- control violence on the border with Mexico, also the terrorist threat facing this nation from our border crisis. House members held a border security hearing in Laredo, Texas, just across the border from lawless Nuevo Laredo, Mexico.

Now, Casey Wian is live in Laredo, Texas, with the story -- Casey.

CASEY WIAN, CNN CORRESPONDENT: Kitty, anyone who remains unconvinced that our nation's broken borders increase the likelihood of a terrorist attack on U.S. soil should be convinced now.

(BEGIN VIDEOTAPE)

WIAN (voice-over): A second day of hearings called by Republicans in the House to promote their border security first approach to immigration reform produced startling testimony about the connection between terrorism and our porous southern border.

REP. ED ROYCE (R), CALIFORNIA: How concerned are you about the drug cartels and smuggling networks and the possible link to terrorism should someone come up with the cold, hard cash to pay those networks?

REYNALDO GARZA, BORDER PATROL LAREDO CHIEF: We're very concerned.

WIAN: Reynaldo Garza is chief of the Border Patrol's Laredo sector. He says 20,000 Border Patrol agents, nearly double the current force, are needed nationwide.

GARZA: Despite the progress we have made, we do not yet have control of our border.

WIAN: Lawmakers released a nonpartisan Congressional Research Service report dated last week documenting a fourfold increase in apprehensions of non-Mexican illegal aliens on the southern border since 2002. The report concludes that stunning rise increases the chances a terrorist will slip through the Border Patrol's grasp.

ROYCE: The FBI has testified to Congress that individuals from countries where al Qaeda is operational are changing their Islamic surnames to Hispanics surnames.

WIAN: Democrats on the committee were unconvinced.

REP. SHEILA JACKSON LEE (D), TEXAS: This is America. And what America is best at is not scapegoating innocent human beings. We simply won't.

(APPLAUSE)

REP. TED POE (R), TEXAS: We are fighting terrorists halfway across the world. We ought to protect our own border. It's a national security issue to protect our borders from those who wish to do us harm.

(APPLAUSE)

WIAN: In addition to the terrorist threat, witnesses told several stories of Mexican drug cartel violence spilling across the U.S. border.

SHERIFF SIGIFREDO GONZALES, ZAPATA COUNTRY, TEXAS: Last Saturday, a detention officer of the Stark County Sheriff's Office (ph), 100 miles southeast of here, went to Mexico to visit his girlfriend. He was reported missing the next day on July 2nd. On July 3rd, his body was found close to Monterrey, Mexico, had been brutally tortured, had been brutally beaten, hands were tied behind his back. His eyes were bandaged. He had been shot in the back of his head, the bullet exiting in the forehead.

WIAN: Gonzales testified that at the officer's funeral two days go one of the mourners was kidnapped allegedly by a Mexican illegal alien already suspected in another U.S. murder case.

(END VIDEOTAPE)

WIAN: Now, if that's not enough to persuade lawmakers to get together and come up with legislation to secure our borders once and for all, it's hard to imagine what would be enough -- Kitty.

PILGRIM: Absolutely horrifying stuff.

Thanks very much.

Casey Wian.

Well, Webb County Sheriff Rick Flores gave Congress a firsthand account of this nation's border wars today, and he warned Congress about the terror threat facing the nation from our broken border crisis. He will be the guest later in the broadcast.

New York State won a significant victory today in its efforts to deny driver's licenses to illegal aliens. A New York State appeals court ruled that New York has the right to force people to prove they are in the United States legally before they receive a driver's license.

Now, this decision reverses a lower-court ruling that said New York cannot deny driver's licenses to illegal aliens. Now, 14 states still allow illegal aliens to have driver's licenses.

Coming up, no letup in the war on the middle class. President Bush says the economy is just great, but his own Labor Department tells a different story.

We'll have a special report coming up.

And Senator Lieberman squares off against a Democratic opponent. Why a top Democrat is facing a tough challenge from within his own party.

Well, we'll tell you.

And President Bush goes on the road. Three of the nation's leading political analysts discuss the road ahead for the White House, illegal immigration legislation, and the upcoming midterm elections.

Stay with us.

(COMMERCIAL BREAK) PILGRIM: There is no relief for this country's struggling middle class. The Labor Department reports the economy added only 121,000 jobs in June, and most of those jobs require no skills and don't pay enough to support a middle class family.

Louise Schiavone reports.

(BEGIN VIDEOTAPE)

LOUISE SCHIAVONE, CNN CORRESPONDENT (voice-over): U.S. jobs growth not great, say analysts about the government's June report.

LAWRENCE MISHEL, PRESIDENT, ECONOMIC POLICY INST.: Slow job growth. The labor market not really -- really tight for regular workers.

SCHIAVONE: But waging a pitched public relations battle over the war in Iraq, immigration, and fuel prices, President Bush will take the labor figures.

BUSH: Productivity is high. People are -- people are better off. Things are working.

SCHIAVONE: The government reports the jobless rate at 4.6 percent. Overall, 121,000 new jobs created, with 31,000 of those government jobs.

Leisure and hospitality, education and health, professional and business services, ranging from temps to accountants, added jobs. But reflecting rising interest rates and stretched personal budgets, the construction sector lost 4,000 jobs and retail lost 7,000.

AUGGIE TANTILLO, AMERICAN TRADE & MFG. COALITION: You have to look at the type of jobs that are being created. Most of them are in lower-end, service sector areas., oftentimes paying minimum wage or slightly above. And in almost all cases, with limited to no health benefits and limited to no pension plans associated with those jobs.

SCHIAVONE: The average hourly wage now stands at $16.70 an hour, almost 4 percent higher than it was 12 months ago. But inflation is giving wages strong competition, up 4.2 percent between May of 2005 and May of 2006. And not everyone's wages can be judged equally.

MISHEL: We have seen the wages of CEOs go through the roof over the last few years, but the wages of typical workers have not really increased relative to inflation over the last five or six years.

(END VIDEOTAPE)

SCHIAVONE: Kitty, while workers' paychecks are larger, their bills, are, too, with fuel costs leading the way. And that, say some analysts, makes the economic picture not quite as rosy as the Bush administration boasts -- Kitty.

PILGRIM: Thanks very much.

Louise Schiavone.

Thanks, Louise.

Well, this brings us to the subject of tonight's poll. Do you believe the productivity of the U.S. economy has improved and people are better off due to the Bush administration policies? Yes or no?

Cast your vote at LouDobbs.com, and we'll bring you the results later in the broadcast.

Let's take a look at some of your thoughts now.

Joe in Delaware writes, "I give the Senate committee my deepest admiration for the way in which they're holding hearings on amnesty with a straight face."

Wayne in Connecticut, "Are we really supposed to believe that the economy would falter with no illegal aliens when we have people out of school who can't get jobs and troops coming home taking six months to a year to find a job?"

Sharon in Texas writes us, "Please tell Michael Bloomberg if he is worried his New York economy will collapse by pass deporting of illegals then he best start hiring Americans for those jobs."

And Kate in Florida, "What was I thinking? That our Congress really has our interest at heart? Only their pocketbooks know for sure. Those lined with big corporate money. Hello? Anyone in Congress listening? Close the borders and stop the overrun of illegals into our country."

Donna in Tennessee, "I wonder every day how much longer the will of the American citizens is going to be ignored when it comes to securing our border."

Send us your thoughts, LouDobbs.com. We'll have more of your thoughts later in the broadcast.

Coming up, Republicans versus Republicans. Senator Rick Santorum is lashing out at fellow senators, pushing illegal alien amnesty. Will it help him in the polls?

In Connecticut, it's Democrat versus Democrat, as Senator Joe Lieberman debates anti-war opponent Ned Lamont. Senator Lieberman says he's not George Bush.

And Sheriff Rick Flores patrols one of the most dangerous areas in the entire United States. He has a dire warning for Americans about the terror threat on our border. He will be my guest.

(COMMERCIAL BREAK)

PILGRIM: Still ahead, Webb County sheriff -- Texas Sheriff Rick Flores will be our guest. He warned this nation today about the worst-case scenario on our broken border crisis, and we'll hear from him about that. But first, some of this hour's top headlines.

Israeli troops pushed deeper into Gaza today and launched new airstrikes to try to free a captured Israeli soldier. Palestinians said five people were killed in those airstrikes.

President Bush today called Mexican president-elect Felipe Calderon to congratulate him on his victory in the presidential vote. The official election count in Mexico shows Calderon won the election by a very small margin. But leftist challenger Andres Manuel Lopez Obrador says the vote was riddled with fraud, and he will address a mass rally in Mexico City's main square tomorrow. He's calling for nationwide protests.

General Motors announced today that it will begin talks with Renault and Nissan on a three-way alliance. GM says these talks will be "exploratory." In a plan put forward by investor Kirk Kerkorian, Renault and Nissan would take a 20 percent stake in General Motors.

Republican Senator Rick Santorum tonight is in the middle of a desperate attempt to turn around his troubled re-election campaign. Senator Santorum trails his Democratic opponent by double-digits in recent polls and he hopes to gain political ground by making illegal immigration his number one campaign issue.

Dana Bash reports.

(BEGIN VIDEOTAPE)

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT (voice-over): This is a sign of the times and Rick Santorum's urgent campaign strategy to save his Senate seat.

SEN. RICK SANTORUM (R), PENNSYLVANIA: We need to deliver first on border security.

BASH: The senator is known to take tough stands on a host of issues, but immigration is a new one. Just two weeks ago, he unveiled his own border security plan. And now he's campaigning on it at forums like this outside Pittsburgh, some 1,500 miles from Mexico's border.

This constituents notes illegal immigration isn't a big problem here.

UNIDENTIFIED FEMALE: Where do you know that this is a -- has become a problem in Pennsylvania?

SANTORUM: Some of the areas there where they have large agricultural interests, fruit growers, landscapers. That's everywhere. Construction, that's everywhere in Pennsylvania.

BASH: Santorum concedes immigration is not a pressing challenge relative to other states, but defends making it the centerpiece of his campaign. SANTORUM: You know, why is immigration such a big issue? And is it an important issue in this race? And what I talk about is that I don't know of an issue that I've gotten more feedback on.

BASH: In his first TV ad, he plays it as a question of fairness.

SANTORUM: My father immigrated here from Italy, with my grandfather.

BOB CASEY (D), SENATE CANDIDATE: This is a guy, he's been talking for weeks now about immigration, and he hasn't done anything about it in the last 15 years.

BASH: Democratic challenger Bob Casey is leading in most polls by double digits. He accuses Santorum of trying to dig himself out of a hole by seizing on a hot national issue, and calls it hypocritical.

CASEY: He's been deliberately misleading people in this campaign about a number of things, but especially on immigration because he's voted against border security seven times.

BASH: Casey says he would have voted for a Senate bill granting rights to citizenship for illegal immigrants. Santorum opposes that and accuses Casey of backing amnesty for law breakers.

CASEY: Well, when Rick Santorum makes that claim and others make that claim, they're lying. It's a lie. And there's no other way to say it.

BASH: At this firehouse, where Casey talked homeland security, asked if immigration is a driving issue, and the answer is no.

JOHN RILEY, FIREFIGHTER: I'm a little afraid that immigration may become a divisive issue as a ploy by the Republican Party to take people's attention away from some of the other issues that I consider important.

BASH: Outside the senator's immigration event, a different answer.

BILLIE JO CROUSE, TEACHER: What effect a little part of Houston, Texas or a place in Arizona is also going to affect me here, because we're all part of one country.

BASH: The senator's hardline on immigration appeals to his conservative base and separates him from an unpopular president. For Santorum to mount a come-from-behind win, aides say, this will be the issue that takes him there.

(END VIDEOTAPE)

BASH: Now, Rick Santorum is the third ranking Republican in the Senate leadership and a top target for Democrats. His decision to make border security a defining campaign theme is a also high-stakes test of the power of immigration as an issue in the midterm elections, Kitty. PILGRIM: Well, how is this working? Any assessment yet, Dana?

BASH: It's probably too early to say. Senator Santorum just introduced this bill on June 23rd. This is really a new effort for him. But I can tell you, talking to people who are working on his campaign, they say, internal polls show that this is an 85 percent issue, meaning when they ask whether or not people are for or against what they label as amnesty, 85 percent say they are absolutely against it.

That's why they are convinced, they say, this is going to appeal more broadly than just to his base. But we'll have to wait and see how that plays out.

PILGRIM: Very much a grassroots issue. Dana Bash, thanks a lot.

BASH: Thank you.

PILGRIM: Well, Webb County sheriff Rick Flores is waging his own fight against aliens in Texas, and he pleaded with Congress today to take seriously the terrorist threat on our border with Mexico. Flores testified at a House Border Security hearing in Laredo, Texas.

This is just over the border from Nuevo Laredo, Mexico, a lawless town, and he says the security situation on the border resembles a war zone, and puts all Americans at risk.

And Sheriff Flores joins me tonight from Laredo, Texas. And thanks for being here, sir.

SHERIFF RICK FLORES, WEBB COUNTY, TEXAS: Thank you.

PILGRIM: You know, these border hearings in different locations around the country, were born of a controversy on Capitol Hill over what should be done next. Do you think these are useful exercises?

FLORES: Well, I hope so. I surely hope so. You know, there's been so much rhetoric being thrown around that we don't know what to believe. But, I hope that this time, they are serious about wanting to provide border security. You know, it's hard to have border security if you don't have homeland security. And that's been our biggest argument right now.

PILGRIM: Do you believe that if they do crack down on the influx of illegal aliens, it will help drug trafficking and human trafficking, which can be related to terrorism?

FLORES: Well, you got both at our -- pretty much the narco traffickers control the human smuggling, and they control everything that's going on. So, they've got the infrastructure already in place for anybody to come and exploit.

And that's our biggest concern, that these people may make their way through Mexico and, of course, blend in and learn the language and the culture and get some documents that are not valid and just cross the border and may cause problems. You know, these people come with a different motive than to come and work.

PILGRIM: Yes. You know, President Bush has asked the National Guard to send 6,000 troops to the border. We haven't hit that level yet, but some are in place. Will that help assist with the drug cartels and the trafficking that's going on on the border?

FLORES: Well, we're going to have more technology, and probably more vigilance along the border. And they're assisting law enforcement in terms of providing not only the vigilance, but also providing technology and also maybe putting some virtual walls, if you will, cameras and sensors, along the borders.

But, however, we're still at the same -- we're back to square one. Anytime that they do confront any bad elements, they're going to have to call law enforcement, because they are not law enforcement officers, and they can't enforce the laws. So we're going to have to respond anyway. And our biggest argument is that ...

PILGRIM: It's the sheriffs that really step into this, is it not?

FLORES: That's absolutely correct, you know. And right now, we've been lobbying for resources, because we provide -- we participate in providing border security, and we've been doing it a long time, even before 9/11.

And now we're even more concerned, because these people from the Middle East can surely blend in and pretty much the same color I am and look like me, and God forbid, they camouflage themselves and come across right down the river here in Mexico and using Mexico as a jumpboard to the United States.

PILGRIM: Sheriff Flores, I noticed a statistic in my research here, and you could probably confirm it with me. We've seen a 52 percent increase in people other than Mexicans using Mexico as the gateway to the United States. Is that accurate? And this kind of increase does not bode well for terrorism, does it?

FLORES: That's true. You're very accurate in that number. And it doesn't sit well with those people that are coming who are other than Mexicans who -- we don't know who they are, and it makes it very difficult for to us identify or classify who are these people.

PILGRIM: Sheriff Rick Flores, thank you very much for joining us this evening.

FLORES: Thank you.

PILGRIM: Coming up, three of the nation's leading political analysts join me to discuss the week's developments.

And Democrats debate Iraq, and one senator's support for the war. A report on why Senator Lieberman is fighting for his political life.

And "Heroes" -- we'll meet one of the first Army Rangers to parachute into Iraq, and now he's fighting to help our troops readjust to civilian life. Stay with us.

(COMMERCIAL BREAK)

PILGRIM: Senator Joe Lieberman ran for vice president six years ago and this year he's running for his political life. In a televised debate last night Senator Lieberman he faced off against political newcomer Ned Lamont, who is challenging him in next month's Democratic primary.

Bill Schneider has the story from Stamford, Connecticut -- Bill.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, Kitty, the primary here in Connecticut between Joe Lieberman and Ned Lamont is supposed to be a one-issue race, but what issue will that be?

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): In the debate Thursday evening, each candidate tried to frame the race. For challenger Ned Lamont, the issue is Iraq.

NED LAMONT, SENATE CANDIDATE: And Senator Lieberman cheered on the president every step of the way, when we should have been asking the tough questions.

SCHNEIDER: Lieberman was dismissive.

SEN. JOE LIEBERMAN (D), CONNECTICUT: I know George Bush. I've worked against George Bush. I've even run against George Bush, but, Ned, I'm not George Bush.

SCHNEIDER: Democratic Congressional Candidate Diane Farrell disagrees with Lieberman on Iraq, but she says she will vote for him in the Democratic primary out of personal loyalty.

REP. DIANE FARRELL (D), CONNECTICUT: We have known each other a very long time and we've respectfully agreed to disagree with one another.

SCHNEIDER: How many Democrats feel that way? It's not clear.

DAVID LIGHTMAN, HARTFORD COURANT: We don't know if it's a referendum on Iraq or a referendum on Joe Lieberman.

SCHNEIDER: You see, Lieberman is running in a primary, and primaries are about sending a message.

LIGHTMAN: It's a Democratic primary and I think what's hurting Lieberman the most is the fact that a lot of Democrats think he's not Democratic enough.

SCHNEIDER: Primary voters are not voting to reelect an incumbent, they're voting to define the parties message.

NED LAMONT (D), FOR SENATE: The senator has seniority, but when you use seniority on the wrong side of the issues that people care about, that's a problem.

SCHNEIDER: Lieberman's appeal is ...

LIEBERMAN: What I am saying for the people of Connecticut, I can do more for you and your families.

SCHNEIDER: His opponent's response is ...

LAMONT: Senator, this is not anybody's careers. This election is about the people.

SCHNEIDER: November is about re-electing the incumbent. That's when Lieberman can count on support from Congressman Chris Shays.

REP. CHRISTOPHER SHAYS (R), CONNECTICUT: I'm going to vote for him, absolutely. This is someone who has put his country first.

SCHNEIDER: But Shays is a Republican. He can't vote in the Democratic primary.

(END VIDEOTAPE)

SCHNEIDER: That's why Lieberman says he will run in November, even if he loses the primary. The November election will be framed the way he wants. About his service, not about the Democratic party's message. Kitty?

PILGRIM: Very strange twist. Thanks very much, Bill Schneider.

Well, Iraq is clearly the big issue in the Connecticut Democratic primary. How will it affect races in the upcoming midterm elections? Joining me now Ed Rollins, former White House political director under President Reagan; Michael Goodwin, columnist with the "New York Daily News"; and Robert Zimmerman, a Democratic strategist.

And thank you, gentlemen, for being with us. Let's start with this Joe Lieberman story, a tough primary fight. And here's what the president had to say last night on LARRY KING LIVE when he was asked if he would endorse Lieberman. So let's listen.

(BEGIN VIDEO CLIP)

BUSH: First, the Democrats have to sort out who their nominee is going to be. And that's going to be up to the Democrats. And the rest of it's hypothetical.

LARRY KING, CNN ANCHOR: But he said he would run as an independent, if he would run.

BUSH: He also has said he is going to win his primary.

KING: I know you like him.

BUSH: You're trying to get me to give him a political kiss, which may be his death.

(END VIDEO CLIP)

PILGRIM: It is just bizarre. OK, what's your reaction to this?

ROBERT ZIMMERMAN, DEMOCRATIC STRATEGIST: I think the Republicans may react the same way that if George Bush gives them a political kiss, it might be death as well.

But the reality simply here is, this is not a primary that's a fight for the heart and soul of the Democratic party. It's a fight where, it's a primary fight which will test really how decisive the Iraq war issue is going to be. And it's not just a case amongst Democrats. If you look at the most recent "Washington Post" poll, 44 percent of moderates want to see a date certain set for withdrawal of Iraqi troops.

And likewise, one-third of the conservatives, people who identify themselves as conservatives, also are committed to a deadline to withdraw our troops from Iraq. So, I think you're going to see this issue, of the president's really quagmire that he's created in Iraq, be a very decisive in races around the country.

MICHAEL GOODWIN, "NEW YORK DAILY NEWS": I think that's wishful thinking, particularly in Connecticut. I think a couple of issues in Connecticut. One is that it's an August primary, so turnout could be very low. A lot of people could be out of the country, at the beach, whatever. And I think that Lamont is very inexperienced. Lieberman is out-fundraising him.

I think to the extent that Lieberman can broaden the discussion, he will have a big impact, because Lamont is really a novice at the game. Around the country, Iraq is one issue, and in many districts immigration more so, and in others, it's jobs and the price of gasoline. So I think it's very hard to nationalize this election on one thing. Iraq is clearly the biggest, but it's not the only one.

PILGRIM: It's the facile one, it may not be the only one. Ed?

ED ROLLINS, FMR. WHITE HOUSE POLITICAL DIR.: Joe Lieberman is truly one of the great men in the Senate, and I don't say that to do the same thing as the president, give him the kiss of death. He's respected by all sides. I think he will win his primary, because I think he has produced for the state. And I think at the end of the day, even if he doesn't win his primary, and he goes as an independent, and he'll get elected, and that is a state that elected an independent, Lowell Weicker, when he ran as an independent.

ZIMMERMAN: That's an interesting point that Ed makes. And that is that if you look at Joe Lieberman's record, he's truly been a leader on the mainstream Democratic issues, the environment, economic growth, protecting human social welfare.

He's really been a very progressive leader. I differ with him very strongly with the issue of Iraq, but I proudly support him in the primary. I think you will see most Democrats, I think Democrats are going to rally to him, for that reason. Because he truly does represent Democratic values and there's this one difference on Iraq. GOODWIN: If I could, Kitty, quickly.

PILGRIM: Sure.

GOODWIN: Let's suppose Lamont fizzles on the Iraq issue. Then I think that's a big warning sign to Democrats everywhere, that Iraq is not going to carry the day in the fall or 2008. That could change a lot of strategies, because it is an August primary. So you'll have a couple of months before you get to the general election, and it could make a big difference.

PILGRIM: Canary in the coal mine lets us know what is happening.

GOODWIN: Yes.

PILGRIM: Let's talk about President Bush and there are indications that he will spend less time on his Texas ranch and do the PR campaigns nationwide to boost his own polls. Let's hear what he said last night on LARRY KING LIVE about that.

(BEGIN VIDEO CLIP)

KING: Are you going to do a lot of campaigning in 2006?

BUSH: Absolutely. I'm doing a lot of campaigning. We're going to be just fine in 2006.

KING: You are going to keep the House and the Senate?

BUSH: We are. You know why? Because we're right on winning the war on terror, and we've got a good economic record. People are working under the leadership of this administration and the Congress.

(END VIDEO CLIP)

PILGRIM: Is this going to sell?

ZIMMERMAN: Let me assure you, if he doesn't appear with Republican candidates, Democrats are going to make sure his picture is next to every Republican candidate for the House and the Senate. But the reality of his strategy is going to ultimately, I think, have a tremendous impact in terms of nationalizing this election, and that's critical for Democrats.

Today he was in Chicago holding a press conference, an aide to the Republican candidate for governor said that he wished he came by the state and campaigned right around midnight. So, clearly, I think Republican candidates have tremendous reservations about that.

ROLLINS: Two things, he does, he can raise tremendous sums of money. He raised a million dollars at lunch for a gubernatorial candidate, and when he goes to a local community, it's a big story. He is in the local media. He'll be all over Chicago television tonight. You know, I'm not sure it's the best strategy, and I'm not sure it's one I would run, but it's better than sitting on the ranch for a month doing nothing. PILGRIM: And it was roundly criticized last year for doing that, too.

GOODWIN: Cindy Sheehan took him hostage. He had to get out of there because of the war protests.

PILGRIM: Let's move on to the other big story of the week, and that's North Korea. Here's what the president had to say about the North Korean leader Kim Jung Il.

(BEGIN VIDEO CLIP)

BUSH: Now that he has defied China and Japan and South Korea and Russia and the United States, all of which said don't fire that rocket. He not only fired one, he fired seven, and he made that defiance it's best for all of to us go to the U.N. Security Council and say loud and clear here's some red lines, and that's what we're in the process of doing.

(END VIDEO CLIP)

PILGRIM: How do you assess the president's response to this crisis?

ZIMMERMAN: It's beyond partisan politics and it is sadly too little. Hopefully not too late. You know, the reality is every president since Reagan has had trouble with North Korea, but under this administration, plutonium stock piles have quadrupled since 2002, and the White House has not engaged in the talks, either through the six-party talks, at times they've walked away from any discussions with North Korea, except to make fun of the leader, understandably so, and to call him names.

The reality is six-party talks are going to be critical, but we have to play a leadership role in that process, we can't outsource our national security to China and hope they will carry the day.

PILGRIM: Yes, and in fact President Bush quibbled with the assessment of the nuclear potential of North Korea today. What do you think?

GOODWIN: I think this is all about the process right now, and I think if the Democrats have any better ideas, they should come up with them, because I think you are dealing with a madman. You're dealing with a cook, frankly, who has nuclear weapons. I don't think anyone has an answer. I don't think there's a silver bullet for dealing with North Korea right now.

President Bush has famously not counted on the U.N., not counted on allies for anything. He's been willing to go it alone. Now he's not. Now he wants to work with Japan and China and South Korea. I think that is the right thing. It may be too late, but I'm not sure there's a better way.

ROLLINS: The danger in all of this, is this is a man who starved his people before. So, a boycott only hurts them. It's not necessarily going to hurt him. He's going to still continue to live in his palaces and all the rest of it, and the danger, which you've always been afraid of, is triggering something with South Korea. We still have 35,000 troops there, and on any given day, something could occur that would create a very, very serious war.

ZIMMERMAN: With all due respect to Michael, George Bush can't get away with saying what's the better idea from the Democrats. He's the president, he controls both houses and both houses of Senate and the Congress, the House of Representatives, and ultimately, this is a test of his presidential leadership.

He has pursued a policy where on the one hand he is not talking North Korea, and we know what a demonic madman the leader of North Korea is, and I don't think he should be engaging in direct talks there. Yet when Iran violated nuclear protocols and procedures, the U.S. did engage in dialogue with Iran. So there's an inconsistency there. Likewise since 2002 they've quadrupled their plutonium stockpiles.

This administration really was missing in action in terms of encouraging the party of six to come together, the six-party talks and truly did not show leadership. So this is not an issue where the president can say, well, what of the Democrats going to be doing? The ball's in his court and he has to show the diplomatic strength to make it happen.

GOODWIN: Well, look, I mean, obviously, he's the president, but is it a matter if just talking directly to North Korea, which is what many Democrats are saying is the answer?

ZIMMERMAN: Right.

GOODWIN I mean, he see is a madman. Is talking to a madman going to make the difference? I mean, the same with Iran. Is talking directly to Iran the answer here?

ZIMMERMAN: Well, I don't think it is in either case but you can't be inconsistent. On one hand, they are talking to Iran directly.

GOODWIN: But, that's process.

(CROSSTALK)

PILGRIM: And we did try talking directly.

ROLLINS: It's going to be the Chinese ultimately that are going to have the role here. I mean, he could care what we say. The more we yell or rattle the saber or go to the U.N., he doesn't care. That only enhances him, but the Chinese clearly have been their ally and he desperately needs them to -- we need them to go basically and negotiate this out.

ZIMMERMAN: We have to really force the Chinese and Russians to come on board.

ROLLINS: Absolutely.

GOODWIN: How do force the Chinese and Russians?

ZIMMERMAN: I would not underestimate our leverage there, and I think we should not put down on our only capability. China certainly depends on the United States for a great deal.

PILGRIM: Gentlemen, they're meeting as we speak. It's not an easy issue to solve. Thanks for helping sort through it.

ROLLINS: Great.

PILGRIM: Robert Zimmerman, Michael Goodwin and Ed Rollins, thank you very much.

ROLLINS: Thank you very much.

PILGRIM: A reminder now to vote in tonight's poll. Do you believe that the productivity of the U.S. economy has improved and people are better off due to the Bush administration policies? Yes or no? Cast your vote at LouDobbs.com, and we'll bring you the results in just a few minutes.

Still ahead, tonight's "Heroes," the story of Army Veteran Andy Davis. He's helping save the lives of U.S. troops thousands of miles -- far away from the battlefields of Iraq, and we'll show you how.

(COMMERCIAL BREAK)

PILGRIM: Now, "Heroes," which is our weekly tribute to the brave men and women serving our country in uniform around the world. And tonight, the story of Army Ranger Andy Davis. He fought with our troops in Afghanistan and Iraq, and now he the fights for the troops returning home.

Lisa Sylvester has the story.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Staff Sergeant Andy Davis was one of the first U.S. soldiers to parachute into Iraq. His Army Ranger unit, the 3rd Battalion, 75th Regiment, was tasked with securing a dam and a bridge that stretched over the Euphrates River.

STAFF SGT. ANDY DAVIS, U.S. ARMY (RET.): They fought us extra hard and they kept fighting and kept bringing in more folks, and no matter how much air support we would call, they were pretty good at hiding. And then when the aircraft would leave, then they would come out and fight us again. So this was a pretty significant fight for a very strategic location.

SYLVESTER: The 25-year-old veteran knew he wanted to serve his country at a young age, influenced by movies like "Top Gun." He joined the Army 10 days after leaving high school. On September 11, 2001, he realized he was going into combat. DAVIS: I was watching the news -- I don't even know which channel it was -- and they kept replaying it and replaying it and replaying it and I knew in my heart that we were going and it was for a good reason.

SYLVESTER: Davis served two tours in Afghanistan and one in Iraq. He was awarded a Bronze Star medal with valor. Now that he's out of the military, he's founded a non-profit, Comfort for Courage, that helps veterans readjust to civilian life.

DAVIS: On this side where we have mounted a head-mounted display, what we're ...

SYLVESTER: In his day job, he creates and tests vision software equipment for the troops.

DAVIS: If you ever used a Hertz rental car where it has the NeverLost system, it's basically that for a person.

SYLVESTER: He's also attending college and running as a Republican for the Minnesota State Legislature, a decision he made after witnessing the elections in Afghanistan and Iraq.

ANDY: Seeing what these people that have nothing to start with, would risk to go vote, to just go put their name on a piece of paper, walking through car bombs, risking kidnappings, all those things and to come home and see people voting more for "American Idol" was really surprising to me.

SYLVESTER: He hopes to convey the message that people need to be engaged, to follow what's going on in the world, and try to make it better.

Lisa Sylvester, CNN.

(END VIDEOTAPE)

PILGRIM: Still ahead, more of your thoughts and the results of tonight's poll.

(COMMERCIAL BREAK)

PILGRIM: Now, the results of tonight's poll. Ninety-six percent of you say the productivity of the U.S. economy has not improved, and people are not better off due to the Bush administration policies.

Let's take a look at some more of your e-mails.

Edward in New Jersey: "Hey Kitty, how come the United States wasn't a choice for the question which country is the greatest threat to the United States?"

Linda in California writes, "I voted for China, but only because the United States wasn't on the list."

And Michael in North Carolina writes, "The way our Congress is selling out to China, we don't have to worry about missiles. If we keep going the way we are, they will own this country without firing a shot."

And Tony in South Carolina writes, "How can Congress call it a hearing when they aren't hearing a thing we say."

We love hearing from you. Send us your thoughts at LouDobbs.com.

Thanks for being with us tonight. Please join us Monday. For all of us here, good night from New York, have a great weekend. THE SITUATION ROOM starts right now with John King.

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

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