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LOU DOBBS TONIGHT

Ehud Olmert: No Cease-Fire; Bush Calls for 'Sustainable Peace' in Middle East

Aired July 31, 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: Tonight, Israel says no to an immediate cease-fire with Hezbollah.
President Bush demands a sustainable peace.

One of the country's leading Middle East analysts and authorities, Fawaz Gerges, joins us -- just returned from Beirut -- to discuss what is required for peace.

A blistering heat wave is rolling across much of this country tonight. Many areas are suffering from triple-digit temperatures. Electricity companies are struggling to keep up with rising demand, raising the question, what national energy policy?

We'll have a special report on our nation's crumbling power grid.

And the number of illegal aliens in this country could be much higher than the government estimates. Perhaps, according to my guests tonight, as high as 30 million. Nearly three times the estimate used by the illegal alien lobby and supporters of the Senate's amnesty bill.

The authors of the important new book "Minutemen" join us here tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT, news, debate and opinion for Monday, July 31st.

Live in New York, Lou Dobbs.

DOBBS: Good evening.

The war between Israel and Hezbollah tonight looks certain to continue for a few more days. The Israeli prime minister, Ehud Olmert, declared there can be no cease-fire in the coming days. The Israeli defense minister said the Israeli military will expand and deepen its offensive against Hezbollah.

Israeli aircraft today launched new airstrikes against suspected Hezbollah positions in Lebanon one day after Israeli aircraft killed at least 50 Lebanese civilians. Israeli troops also launching new raids into southern Lebanon.

The Syrian president told his army to raise its readiness because of the war.

Matthew Chance tonight reports from northern Israel on the 20th day of the Israeli offensive.

Karl Penhaul reports from a town in southern Lebanon where Israeli troops and Hezbollah terrorists fought hand-to-hand battles.

And Suzanne Malveaux reports from the White House tonight on the president's determination to continue support of Israel's offensive.

We turn first to Matthew Chance -- Matthew.

MATTHEW CHANCE, CNN SR. INTERNATIONAL CORRESPONDENT: Lou, thanks very much.

And as world leaders squabble over the need for an immediate cease-fire, Ehud Olmert, the Israeli prime minister, has struck a defiant note saying there will be no cease-fire at the moment and there are a few days left, in his words, of fighting at the very least. Certainly, that's the message that's been received here at the artillery battery, one of them, just a short distance from the Lebanese border in northern Israel where soldiers have been pounding what the Israeli military say are Hezbollah strongholds in southern Lebanon, and supporting the Israeli ground forces that have been active there in southern Lebanon for the past several days, even staging new incursions.

It's been very close combat that they've been engaged in with Hezbollah fighters. Hezbollah fighters fired anti-tank missiles at at least one tank. Possibly another armored vehicle as well disabling them. So it's by no means a pushover for the Israeli soldiers that are fighting inside southern Lebanon.

In the other direction, there's been some fire coming over as well from the Hezbollah side. But I have to say, nowhere near the level of rockets that we've been witnessing coming over here in the past several weeks.

Normally, about 100 a day are shot across by Hezbollah. Today there has just been three explosions, all of them, according to the Israeli military, merely mortars, not the much more highly-powered Katyusha rockets that have been raining down on towns and cities across Israel, northern Israel particularly, over the past several weeks. So there has been somewhat of a lull in fighting in that sense, but on the Israeli side the artillery barrage is still continuing, even though they've stopped pounding behind me, and the Israeli ground forces are still very much on the ground in southern Lebanon -- Lou.

DOBBS: Matthew, thank you very much.

Matthew Chance reporting from northern Israel.

Syria's president, Bashar al-Assad, today ordered his army to raise its readiness because of the continuing conflict between Israel and Hezbollah. Syria will not abandon what he called the Lebanese resistance against Israel.

Aneesh Raman reports now from the Syrian capital of Damascus -- Aneesh.

ANEESH RAMAN, CNN CORRESPONDENT: Lou, good evening.

In that statement, the Syrian president also said Israel's war on Lebanon was a war of genocide. He told the Syrian troops to raise their readiness.

There was no mention, though, of an increase in troop numbers, an increase in movement of military assets towards the border. It seems the statement was meant more as a defensive rather than offensive statement. Syria has maintained it does not want to be part of this military conflict, but if attacked, it will respond.

The timing, though, is interesting. Syria wants to be part of any peace deal that is brokered. And in the aftermath of the attack on Qana, Lebanon, amid further fury in the Muslim world, amid calls for an immediate cease-fire, and for a deal to be brokered, Syria could here be posturing to remind the world of its import in the region. And a top Syrian diplomat, Lou, that I spoke to today said that if the U.S. or anyone is interested in longstanding sustainable peace in the region, Syria must be at the table.

There is no sign, though, that the U.S. is willing or eager to engage Syria directly. They say Syria is a sponsor of terrorism given its close ties to Hezbollah. But Syria has found further confidence, it seems, in the past few days.

The top diplomat told me that the Egyptian foreign minister was just here, nine foreign ministers have contacted in the past few days the Syrian foreign minister. They are emboldened, it seems, to state their presence, and they want to be part of any peace deal -- Lou.

DOBBS: Aneesh, thank you very much.

Aneesh Raman reporting tonight from Damascus.

President Bush today demanded what he called a sustainable peace in the Middle East. President Bush did not call for an immediate cease-fire in this conflict. The president said Israel has a right to defend itself, and he mourned the loss of innocent life in both Lebanon and Israel.

Suzanne Malveaux reports from the White House -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, we expect within moments Secretary of State Condoleezza Rice will arrive here at the White House after her shuttle diplomacy trip. Of course, she'll be meeting with President Bush, as well as the national security adviser, Stephen Hadley, all three, for a working dinner at the residence inside the White House.

A senior administration official saying that they president will get a debrief, and, of course, they will strategize about the way forward. It is a critical time, a window of time, of course, that is closing rapidly, senior administration officials acknowledge. This coming after the Israelis mistakenly hit a civilian target in Qana. (BEGIN VIDEOTAPE)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We're going to work with our allies to bring before the United Nations Security Council a resolution that will end the violence and lay the groundwork for lasting peace in the Middle East.

MALVEAUX (voice over): That resolution includes a permanent cease-fire, a deployment of Lebanon's army in Hezbollah-controlled areas, a global embargo against rearming Hezbollah, and a new international force to help enforce any cease-fire.

Israeli officials indicate for now they're on board with Rice's resolution, which does not require Israel to immediately stop its attacks.

EHUD OLMERT, ISRAELI PRIME MINISTER (through translator): I have to say that everybody has said to me, "No cease-fire. No cease-fire."

MALVEAUX: That position has earned the condemnation of European and Arab allies alike, raising the stakes even higher for Rice's diplomatic mission.

DAN BENJAMIN, CENTER FOR STRATEGIC & INTERNATIONAL STUDIES: There's no question that the United States has a public relations disaster on its hands. The question really is whether the leadership is prepared to ride it out in order to achieve its strategic goals.

MALVEAUX: But the Bush administration is heartened by what it sees as an emerging tough stance towards Iran, which it believes may have orchestrated Hezbollah's attacks to distract attention from its nuclear program. Monday, the U.N. Security Council passed its first resolution giving Iran until the end of August to freeze its uranium enrichment program or face possible economic sanctions.

BUSH: It goes to show that when America takes the lead and works with our friends, we're able to accomplish diplomatic objectives.

MALVEAUX: But political analysts say time is not on the administration's side. Israel says it needs perhaps up to two more weeks to carry out its military campaign against Hezbollah. The U.S. will be back before the U.N. Security Council by midweek to broker its resolution and what the administration calls a sustainable peace.

UNIDENTIFIED MALE: From the U.S. perspective, if there are more civilian casualties in the manner of Qana, then it's going to be a very, very difficult passage for the United States.

(END VIDEOTAPE)

MALVEAUX: So, Lou, in some ways U.S. officials acknowledge that it is a race against time. They not only need the cooperation of the U.N. Security Council, but they also need the cooperation of Lebanon because they really need for Lebanon to weaken Hezbollah militarily at a time when it is strengthened politically -- Lou.

DOBBS: Suzanne, thank you very much.

Suzanne Malveaux reporting from the White House.

President Bush today praised the United Nations Security Council for its passage of what he called a strong resolution against Iran's nuclear weapons program. The Security Council ordered Iran to stop enriching uranium by the end of August or face possible sanctions, without discussion of what those sanctions would be, and this at least the second time that a deadline has been set for Iran.

Russia and China insisting the Security Council cannot introduce resolutions without further discussion. The U.S. ambassador to the United Nations, John Bolton, said Iraq is a direct threat to international security.

(BEGIN VIDEO CLIP)

BOLTON: This is the first Security Council resolution on Iran in response to its nuclear weapons program reflecting the gravity of this situation and the determination of the council. We hope this resolution will demonstrate to Iran that the best way to end its international isolation is to simply give up the pursuit of nuclear weapons.

(END VIDEO CLIP)

DOBBS: And Iran responded immediately, immediately rejecting the Security Council resolution. Iran said the resolution "violates the fundamental principles of international law."

That brings us to the subject of our poll tonight. Do you believe any non-military resolution will be effective in convincing Iran to stop its nuclear program? Yes or no?

Cast your vote at loudobbs.com. We'll have the results later in the broadcast.

In the war in Iraq, insurgents have killed eight of our Marines since last Thursday. All the Marines were killed in Al Anbar province west of Baghdad. The insurgent attacks come as the military is sending more troops to Baghdad trying to stop rising sectarian violence in the Iraqi capital.

2,576 of our troops have now been killed in Iraq, 19,157 of our troops wounded. Of those 8,773 seriously wounded.

Disturbing evidence tonight that terror suspects in Guantanamo Bay are routinely attacking their military police guards. A Pentagon report says prisoners have attacked guards hundreds of times using broken toilet parts and just about anything else they can lay their hands on. The report describes more than 440 incidents from December 2002 through the summer of last year. Nearly a quarter of those attacks targeted female guards.

Four hundred fifty terrorist suspects from around the world are being held at Guantanamo Bay. Coming up here, it's been five months since Dubai Ports World promised to sell its U.S. port operations. Guess what hasn't happened in those five months?

We'll have that report.

Also tonight, this is what our so-called free trade policy with communist China is coming to. We'll tell you why Americans are now living in empty shipping containers from communist China.

And we'll have much more on Israel's decision to press ahead with its offensive against Hezbollah. Nic Robertson reports live from Beirut and Middle East expert Fawaz Gerges joins us.

Stay with us for all of that and a great deal more here next.

(COMMERCIAL BREAK)

DOBBS: President Bush today decided to go to Miami, where today he pushed his plan for so-called comprehensive immigration reform at the Port of Miami, where Dubai Ports World continues to run critical port operations. And during his speech, President Bush said almost nothing about the astonishing breakdown in security at our ports around the country.

Dubai Ports World, which had promised to divest itself of operations at more than 20 American ports, still has not sold off those facilities. Dubai Ports World promised more than four months ago that it would sell its U.S. port terminals within four to six months.

We're keeping count, believe me.

Wal-Mart is caving into pressure from communist China and allowing its Chinese workers to unionize. Not so in this country.

Wal-Mart workers in China have formed their first-ever union in southeast China. Wal-Mart has aggressively fought efforts by its American workers to organize in the United States, but it's aggressively trying to expand its presence in China. And apparently that means it is willing to permit unions. The communist Chinese government, however, is somewhat less flexible than U.S. jurisdictions demanding that Wal-Mart allow Chinese workers to unionize.

In this country, there's a powerful new symbol of the United States' exploding trade deficit with communist China. Shipping containers, thousands of them coming from China carrying all those cheap Chinese goods into the United States, don't go back to China with a lot of American products. So what happens is they stay right here, and in some cases they're being used as housing for poor Americans.

Casey Wian reports.

(BEGIN VIDEOTAPE) CASEY WIAN, CNN CORRESPONDENT(voice over): Welcome home. No, not here. Back there. These stacks of shipping containers near the port of Los Angeles may soon be used to build your next house.

PETER DEMARIA, DEMARIA DESIGN: This custom home is just over 3,000 square feet.

WIAN: Architect Peter DeMaria is designing homes out of shipping containers. They're pre-insulated and already have hardwood floors. They're strong, resistant to mold, termites, and fire, and above all, they're plentiful.

DEMARIA: The cost of steel and the cost of concrete has gone through the roof recently. That forced us to explore some alternative materials.

WIAN: China's voracious appetite for building materials has driven up costs of traditional construction. And the nation's massive trade deficit with China and others has left hundreds of thousands of empty shipping containers piling up in storage yards all over the country.

So a growing number of architects and builders are using the container glut to save their clients hundreds of thousands of dollars. Custom home construction in southern California can easily cost $250 a square foot. This house is being built for about half that. But the mountains of containers are a big problem for others.

Last year, seven million containers arrived here full of imported goods, but only 2.5 million left carrying American exports. Many of the rest are now polluting residential areas near the ports.

JANICE HAHN, LA CITY COUNCIL: This is the unintended consequence, really, of the whole international trade industry, but particularly because of this gap that we have between imports and exports. But it is a blight that really no other community I think in America suffers.

DEMARIA: This is a slab floor here.

WIAN: Architect DeMaria says recycling the containers for home construction will help improve the environment. He's also working with the city of Los Angeles to use shipping containers in low-income housing.

(END VIDEOTAPE)

WIAN: The city of Los Angeles recently passed an ordinance prohibiting the operation of new shipping containers storage yards near residential neighborhoods.

Lou, the situation is so bad that in some areas the sun sets an hour early because of the high stacks of shipping containers -- Lou.

DOBBS: Casey, that's just an amazing, remarkable story. And what a metaphor for what is happening to this country. The Chinese becoming so wealthy, they can leave millions of these containers in this country because there's certainly no American goods to be shipped back to China. I mean, that's incredible.

WIAN: It really is. And as one shipping industry executive put it recently, he said one of the things -- the thing that's most often moved around Los Angeles in these shipping containers is empty air because we're simply not sending anything back to China.

DOBBS: As I say...

WIAN: A brand new world.

DOBBS: ... just a terrific story, Casey. Thank you very much. And a sad commentary on our times.

Thank you.

Casey Wian from Los Angeles.

Still ahead here, the dangerous heat wave gripping much of this country is moving eastward. Our nation's aging, neglected power grid may not be able to hold up. And, oh, yes, what about that national energy policy?

We'll have a live report for you next.

And also, American voters almost elected the wrong candidate because of an electronic voting machine breakdown and meltdown. It's our democracy at risk. Electronic voting machines, you're going to love this one.

We'll have a special report.

And Israel says there will be no cease-fire in its battle against Hezbollah. We'll be going live to Beirut for the very latest from our Nic Robertson. And Middle East expert Fawaz Gerges joins me as well.

All of that and more still ahead right here. Stay with us.

(COMMERCIAL BREAK)

DOBBS: More evidence tonight that the security of our elections, the integrity of our democracy are at risk from electronic voting machines. A county in Iowa has just come close to putting the wrong candidate in office because of a massive programming error.

Kitty Pilgrim has the report.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice over): On June 6th, in Iowa's Pottawattamie County, the early electronic vote tally showed a popular 23-year incumbent losing to a 19-year-old college student. Highly suspicious, the auditors stopped the electronic count and started counting by hand. The electronic machines made by ES&S, one of the three major voting machine companies in the country, had miscounted every race on the ballot.

LOREN KNAUSS, POTTAWATTAMIE COUNTY SUPERVISOR: The discussion that we had afterwards as we started doing our review, the company, ES&S, misprogrammed the computers. And then on our side, the tests were not thorough enough. So it was -- we'll just say it was a 50-50 mistake on their side and ours.

PILGRIM: Knauss was running against 10 people in a Republican primary, and according to the voting machines, he was coming in ninth. After the manual recount, he came in first. He says without a paper trail, the election would been completely botched by the electronic machines.

Electronic voting experts have come to a conclusion over what went wrong with the ES&S machines.

JOHN WASHBURN, VOTERTRUST USA: What happened in Pottawattamie County is that they have a rule that the paper ballots, the names from precinct to precinct, have to rotate. So, while I might be at the top of the ballot in precinct one, I'd be number two in precinct two, number three in precinct three, and so on.

What the machinery did, though, is the programming didn't take into account this rotation on the paper ballots. And so, regardless of whatever name was on the top of the ballot, it would always accrue for a single candidate.

PILGRIM: Computer experts point out in this case how the ballot was programmed was a mistake. But misprogramming ballot tabulation could also be done on purpose if someone wanted to tamper with an election.

(END VIDEOTAPE)

PILGRIM: The Iowa secretary of state says the programming by the vendor was done incorrectly. So the state is going to pay more attention to the pre-election testing of the machines.

But ES&S issued a statement saying the issue was not related to the reliability of the machines, rather error in the way the ballots were coded. It was a human error, they say.

All of this goes to prove, you really do need this paper trail.

DOBBS: Went from ninth to number one. If this message is not getting through that's emanating from every corner of the country using these voting machines, I don't know what it will take.

PILGRIM: I know. And when you talk to county after county after county that have these problem, they all come to the same conclusion, you must have a paper record, it seems.

DOBBS: And I love the electoral officials in these counties and districts, and in some cases states, saying we're going to pay closer attention this time. Wouldn't you pay close attention every time?

PILGRIM: One would hope so. It is an election.

DOBBS: Kitty, thank you very much.

Kitty Pilgrim.

This is one of those nights in which one has to shake your head. It's just one thing after another.

Thank you.

Taking a look now at some of your thoughts.

Speaking of shaking your head, many of our viewers doing so, particularly on the issue of the conflict between Israel and Hezbollah, and coming down just about evenly divided on the issue.

"Lou, I don't blame Israel for their assault," Tony in Indiana said, "on terrorism. In fact, I applaud their resolve to root out those extremists from where they actually operate. If Lebanon was serious about being a real democracy, they would have already done what Israel is doing right."

Shadi in North Carolina, "Are we expected to believe that Israel accidentally killed those U.N. soldiers last week, accidentally killed all those people in Qana, which is also the same city Israel accidentally hit in 1996, and also ignore the fact that Israel said it would halt strikes for 48 hours and they have not? Give me a break."

And Elaine in New Jersey, "I'm at a loss for words as to why only your show is the way I get to hear about what is happening in Iraq. The administration, with no idea what to do in Iraq, is constantly keeping what's happening in Israel and Lebanon in the news on other networks, including your own, CNN."

Send us your thoughts at loudobbs.com. We'll have more of your thoughts here later in the broadcast.

Tonight, the Midwest principally is suffering from some of the worst heat of this summer. Temperatures are baking the country east of the Rockies. Can power supplies meet demand? And what happened to that energy policy and the national power grid?

That special report coming up.

The Senate is preparing for its summer recess. But what has Congress accomplished for the middle class? We'll be live with that report in Washington.

And there is no cease-fire in the Middle East. We'll be going live to Nic Robertson in Beirut tonight. And I'll talk with one of the leading authorities in the country on the Middle East, Fawaz Gerges

Stay with us. (COMMERCIAL BREAK)

DOBBS: Tonight the Israeli prime minister is ruling out an immediate cease-fire with Hezbollah, and the president of Syria is ordering his army to raise its readiness.

Middle East expert Fawaz Gerges will be here in just moments. Nic Robertson will be reporting live from Beirut.

But first, the intense heat wave gripping much of the nation, killing more than 100 people in California last week, is tonight hitting the Midwest. Much of the Midwest today saw the heat index jump to well over 100 degrees.

St. Louis, Chicago, Cincinnati, other Midwestern cities under heat warnings tonight. This heat wave is expected to move further east tomorrow. East Coast residents will see temperatures at or near 100 tomorrow and Wednesday.

The heat wave is putting enormous strain on our nation's aging power grid. Already this summer blackouts have hit New York, California, Missouri and Arkansas. Years of neglect are raising new questions about the stability of our power infrastructure.

Bill Tucker has the report.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice over): Consumers boil when their electric company fails in its promise to provide power, especially during a sweltering summer. Con Edison's CEO was on the receiving end of that anger from members of New York's City Council, who wanted to know why, despite claims of improvements in the electrical grid, the power went out, leaving tens of thousands of New Yorker in the dark for more than a week.

PETER VALLONE, NEW YORK CITY COUNCIL: The improvements you are going to make with communication, with the grid, was all said before. Fool me once, shame on you. Fool me twice, shame on me. Why should we believe you this time?

TUCKER: It's not that money isn't being spent. It is.

But demand nationally is growing faster than the investment. In their report card on the nation's infrastructure, the American Society of Civil Engineers gave energy a D. They estimate that we need to spend $10 billion a year for the next five years on improving the nation's power grid. The current rate of investment is roughly one- third that amount.

Meanwhile, there are other efforts aimed at reducing demand: utility companies urging consumers to cut back on their usage, an idea that some say is a nice idea with no chance of succeeding.

JEFF SCHULTZ, WEATHER 2000: Every person has so many electrical device, computers, cell phones. Air conditioning, of course, is the -- is the big factor right there. And when you put all those heat and electricity-drawing equipment together with the high population, it's a different scenario.

TUCKER: The bottom line for the North American Electric Reliability Council, a consortium of public and private power producers, is that Congress needs to get involved.

(END VIDEOTAPE)

TUCKER: The group wants Congress to pass legislation which would subject the industry to mandatory reliability standards, Lou. They made this recommendation to Congress not yesterday, but two-and-a-half years ago. And, as of yet, no action has been taken -- Lou.

DOBBS: Bill, thank you very much -- Bill Tucker.

In the war between Israel and Hezbollah, the Israeli security cabinet has just agreed to widen the Israeli ground offensive in Lebanon. One Israeli official said there will be no cease-fire until an international force can be deployed in southern Lebanon -- Israeli aircraft today carrying out more airstrikes on what Israel says are terrorist targets in Lebanon, and Israeli troops launching new raids into southern Lebanon.

Nic Robertson has the report from Beirut -- Nic.

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Lou, the Israeli government did apologize today for striking a Lebanese army vehicle. It had Lebanese army registration plates.

An aide to a general was killed, three soldiers wounded -- a lot of people taking the Israeli conditional lull in bombing, the 24-hour sort of hold-off on bombing -- 48-hour hold-off on bombing -- to go in, get possessions from their homes or leave their homes completely -- so, a lot of people fleeing the south of Lebanon in the early hours of the day.

But, as the day progressed, Hezbollah firing back at Israeli tanks in one of their ground incursions -- Israeli aircraft coming in and firing in support of the Israeli troops -- so, the offensive still very much under way in the south, another part of the southern border between Israel and Lebanon crossed by Israeli forces, that closer to the west, closer to the sea -- aide officials here saying now that they believe that the country is reaching a tipping point.

That is, people, displaced people -- and the UNHCR says there are about 800,000 of those in Lebanon now -- people now dipping into their own food reserves -- the humanitarian officials here not able to reach out to everyone, very concerned about that.

In Beirut tonight, we have seen some shuttle diplomacy, if you will, the French foreign minister in town, meeting with the prime minister, then going off to meet in the Iranian Embassy with the Iranian foreign minister -- no joint statement, but a clear indication there that Hezbollah's allies Iran now being talked to about the possibility of -- of helping end the current conflict, and France now emerging as a sort of diplomatic leader, offering 5,000 troops for a potential peacekeeping force here -- Lou.

DOBBS: Nic, thank you very much -- Nic Robertson tonight, reporting live from Beirut.

President Bush today declared that the war between Israel and Hezbollah is part of what he called a larger struggle between the forces of freedom and the forces of terror.

Joining me now to give us his perspective, one of this country's top analysts on the Middle East, Fawaz Gerges, professor of Middle East and international affairs at Sarah Lawrence College, author of the book "Journey of the Jihadist: Inside Muslim Militancy."

Fawaz, good to have you with us.

FAWAZ GERGES, EXPERT ON MIDDLE EASTERN STUDIES, SARAH LAWRENCE COLLEGE: Thank you.

DOBBS: The idea that there is no cease-fire -- today, no rockets fired into Israel. Israel is claiming that it has done significant damage to Hezbollah's ability to launch those rockets. And it may even be the case. Do you think a cease-fire is on order until Israel can accomplish its objectives against Hezbollah?

GERGES: Well, Lou, as you said, we don't know whether Hezbollah has been weakened militarily or not.

I mean, I have spoken -- when I was in Beirut in the last weeks, I spoke to quite a few Hezbollah leaders and activists. And I was really surprised by how confident they are. And it seems to me that, according to Hezbollah people, that they have weathered the initial storm, and they have taken the initiatives.

And, looking at public polls in Lebanon, it seems to me that public support for Hezbollah has increased considerably in the last 10 days. You have almost 87 percent of the Lebanese, Sunnis and Shias and Christians support Hezbollah's...

(CROSSTALK)

DOBBS: About a third each of the population.

GERGES: Absolutely, which is a very, very alarming sign.

It seems to me that, far from weakening Hezbollah, if we are, if we were to believe the polls and the studies we have done, that Hezbollah has become more emboldened and more empowered by Israel's military campaign, because, Lou, most of the casualties have been civilians.

And many Lebanese, initially, when I talk to Lebanese, many Lebanese were highly critical of Hezbollah. Hezbollah miscalculated monstrously. But many Lebanese are asking now, look, why Israel, I mean, targeting the entire Lebanese infrastructure? Why the population? Why the bridges? Why the seaport? Why the port? And this is why Hezbollah is gaining tremendously in public opinion, not just in Lebanon, but throughout the Arab and Muslim world.

DOBBS: With all -- with so much to lose, why did the Lebanese government not take steps to take control of Hezbollah?

GERGES: Well, Lou, this is a highly critical question.

I mean, Hezbollah is much more powerful than the Lebanese government, make no doubt about it. Even the Lebanese government would like to disarm Hezbollah -- and I know many ministers within the government who would like to disarm Hezbollah -- the Lebanese government cannot, does not have the capacity to disarm Hezbollah.

Hezbollah, Lou, is one of the most powerful, pivotal, forces, not just paramilitary, but political forces in the country.

DOBBS: Absolutely, and a terrorist organization at the same time, correct? And, at the same time, it has to be dealt with by Israel. The fact is that Hezbollah has, as you said, faced a -- Hezbollah has miscalculated monstrously, I believe you said. Saudi Arabia agreed. So did the king of Jordan, and as did the Lebanese prime minister.

If you're right, that Israel has gone beyond proportionate response here, and is weakening an already frail Lebanese government, and if Hezbollah has that kind of influence within Lebanese society, there are far more serious considerations here, it seems to me, based on your analysis, than simply a cease-fire, or President Bush saying, we need a sustainable peace, because now you're talking about a society in Lebanon...

GERGES: Yes.

DOBBS: ... that is not only radicalized in each of those groups, whether it be the Christian, the Sunni or the Shia...

GERGES: Yes.

DOBBS: ... but a force that has to be contended with for years to come.

GERGES: Several points.

The reason why there is a swell of support for Hezbollah, as I suggested, because of Israel's punitive measures perceived by the Lebanese people against the entire country. Many people are realizing that Israel's war is not just against Hezbollah, against the entire Lebanese people -- point one.

Point two, Lou -- and this is really a highly critical point -- there's a consensus within Lebanon that the status quo is not viable. This is a very important point. A consensus has emerged, that the Lebanese government must deploy its army to the south, the Lebanese- Israel border. The Lebanese government must be the only agency that has a monopoly on the use of force. Translation: That means Hezbollah must be disarmed.

And the question here, how do you help the democratically elected government in Lebanon...

(CROSSTALK)

DOBBS: Let's go to that question.

GERGES: ... you see. And this -- and the -- you do it, and the Lebanese government, as you know, has a peace plan of seven points. First, we need a cease-fire. We need to stop this bloodletting.

I mean, remember, 600 Lebanese civilians have been killed, 2,000 injured, almost a million displaced. And this is why Hezbollah has gained in public opinion. Have a cease-fire, enable the Lebanese government to deploy its army to the south, deploy an international force to help the Lebanese government.

DOBBS: But, right now, we can't find an international force to move in...

GERGES: No, but...

DOBBS: ... to southern Lebanon.

GERGES: But the Lebanese government is telling you, we are willing, we are willing -- for the first time, Lou, since 2000, since Israel pulled out in 2000 from Lebanon -- Lebanon...

DOBBS: Right.

GERGES: Israel occupied a small strip of land in Lebanon from 1982 to 2000.

The Lebanese government now, the prime minister, the consensus in Lebanon, we want to deploy the army to the south. We want to integrate Hezbollah...

DOBBS: Right.

GERGES: ... into the Lebanese institutions. Give us an international force. Help us. But, first, stop...

DOBBS: You want to integrate Hezbollah into the institutions.

GERGES: Yes.

DOBBS: But here is the choice for Israel and the choice for the rest of the world.

If Hezbollah is capable and intent and motivated in its entirety and incentivized to continue these attacks, with the sponsorship and support of Iraq and Syria, how can there be a sustainable peace, because these issues still are very much alive and must be vigorously dealt with...

GERGES: Yes.

DOBBS: ... whether by diplomacy or military action?

GERGES: Two -- two points here. And you're raising very important questions.

The peace plan by the Lebanese government means the end of the state of war between Lebanon and between Israel. Hezbollah will become a purely, (INAUDIBLE) political party, functioning within the democratically elected Lebanese institutions.

And Hassan Nasrallah -- this is really fascinating -- I mean, this is -- in his last media interview, Nasrallah, the leader of Hezbollah, said, this could be the last battle that Hezbollah fights on the behalf of the Palestinian and the Arab people.

And, also, I think your -- your logic point is that, as long as the Arab-Israeli conflict simmers, there will be instability. And you're absolutely correct. This is why we need to deal with the root causes...

DOBBS: Right.

GERGES: ... two viable states, a secure, viable Israeli state...

DOBBS: No more five years to get something done, would you not agree? Because I would think that that region -- and certainly many people in this country have had more than enough of talk and so-called diplomacy, whether it be called shuttle or otherwise -- and if ever there were a time for action and actual results, it would be now.

Do you think, however, that the creation of a Palestinian state would be resolution?

GERGES: I really believe, Lou, it will be a turning point, not just in the history of the Middle East, but in the history of Muslim- American relations.

It will pull...

DOBBS: If it secure...

GERGES: It will pull the...

DOBBS: If it secures...

GERGES: It will pull the rug out of the feet of the militants and the radicals, and the ultra-militants, like al Qaeda and other groups in the Middle East.

DOBBS: Then...

GERGES: And this is really...

(CROSSTALK)

DOBBS: Well, let then there be equity for the Palestinians, the Israelis.

GERGES: Absolutely.

DOBBS: Let's get to that peace as quickly as possible.

GERGES: Yes.

DOBBS: Fawaz Gerges, always good to have you with us.

GERGES: A pleasure.

DOBBS: Still ahead here: Congress proved this weekend it's waging an all-out war against middle-class Americans. We will have that report.

And local governments are stepping up their fight against illegal aliens in their own communities. We will tell you about a new effort to designate police officers as immigration officers as well.

And I will be talking with the author of an important new book on our immigration -- illegal immigration and border security crisis. The book is "Minutemen" -- next.

(COMMERCIAL BREAK)

DOBBS: Congress, you will be happy to know, begins its summer vacation this week. But lawmakers haven't agreed on how to deal with our border security crisis, how to stop illegal immigration, how to reform our system, and the list goes on. They haven't agreed either on a new minimum wage law, although, to some, it might appear they have.

Lisa Sylvester has the report.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Congress doesn't show up for work very often. This year, the House will be in session only 77 days. Democrats blame the Republicans.

SEN. HARRY REID (D-NV), MINORITY LEADER: Like the do-nothing Congress of 1948, it's very difficult to get anything out of this Republican Congress.

SYLVESTER: But Democrats also share the blame. When lawmakers are in Washington, critics say they're passing legislation that's hurting middle-class families.

BOB GREENSTEIN, EXECUTIVE DIRECTOR, CENTER FOR BUDGET AND POLICY PRIORITIES: Congress has a pretty dim record on issues important to the middle-class. In fact, if you take the whole balance sheet, this Congress has actually made the middle-class squeeze worse than it was. SYLVESTER: Congress cut $13 billion in college student aid, passed free trade agreements that labor groups say threaten American jobs, approved a bankruptcy bill that's favorable to creditors, but takes away consumer protections,.

And, on the minimum wage increase, the House approved a bill, but loaded it with attachments that makes it almost dead on arrival in the Senate. The minimum wage has not been raised in a decade, and most Americans approve of the wage hike.

MASSIE RITSCH, COMMUNICATIONS DIRECTOR, CENTER FOR RESPONSIVE POLITICS: Well, Congress is about to head home for the summer. And their constituents will ask them, so, what have you done for us lately? Our gas prices are still high. Your prescription drugs still cost a lot. Lobbyists are still running Washington.

SYLVESTER: Congressional members continue to bicker over other middle-class concerns: illegal immigration, rising gas prices, health care costs, and trade issues.

BILL SAMUEL, LEGISLATIVE DIRECTOR, AFL-CIO: Companies have their ear. Corporate executives have their ear. Ordinary Americans have a very difficult time being heard in Washington.

SYLVESTER: Maybe that's why Congress' approval rating is only 25 percent.

(END VIDEOTAPE)

SYLVESTER: Now, Congress did find time to take up the so-called cheeseburger bill, aimed at shielding food companies like McDonald's from lawsuits, to step in for the Terri Schiavo feeding tube case, and to act to secure their eighth consecutive congressional pay raise -- Lou.

DOBBS: It's amazing.

And, as you point out, Congress' approval rating at 25 percent makes George W. Bush look like a wildly popular president, doesn't it?

SYLVESTER: It does, indeed. And I think voters are going to remember this record on Election Day -- Lou.

DOBBS: Lisa, thank you very much.

(LAUGHTER)

DOBBS: Lisa Sylvester, reporting from Washington.

And it's nice that everybody in Congress is going to be able to go out and get some rest and come back reinvigorated, I'm sure refocused.

While Congress fails to fix our broken border, citizens are taking action. In Phoenix tonight, a group says it has collected enough signatures to put a tough new immigration -- illegal immigration measure on the ballot. It would require Phoenix to designate police officers as immigration officers as well, and would allow them to investigate, apprehend and detain illegal aliens.

Phoenix Mayor Phil Gordon's office tells us he's concerned that passage would help take Washington off the hook.

To me, to be just straightforward with you, it sounds to me like the mayor is trying to get off the hook.

The Justice Department and the Department of Homeland Security have announced that they're sending 25 additional federal prosecutors to U.S.-Mexican border. These new federal prosecutors will deal exclusively with illegal immigration cases, as our nation's border security crisis intensifies.

There's just one catch in today's announcement. You knew there would be a catch, didn't you? These federal prosecutors have not yet been hired. The Homeland Security Department tonight promised that this hiring process will begin -- quote -- "immediately."

A reminder now to vote in our poll: Do you believe that any non- military resolution will be effective in convincing Iran to stop its nuclear program? Yes or no. Cast your vote at LouDobbs.com. We will have the results coming up here in a moment.

Today, much of Mexico City was at a standstill. The supporters of the defeated presidential candidate were in the streets, demonstrating a second day. They're demanding a recount. We will have the latest.

And an important new book says the number of illegal aliens in this country is grossly underestimated, conveniently so. I will be talking with the authors of the new book "Minutemen."

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Coming up at the top of the hour: "THE SITUATION ROOM" with Wolf Blitzer, who recently returned from Jerusalem.

Wolf, good to have you back. What have you got for us?

WOLF BLITZER, HOST, "THE SITUATION ROOM": Thanks very much, Lou.

They're breaking news happening right now. Israel has decided to expand -- expand -- the ground war in Lebanon. We're covering all sides.

And there's another breaking story we're following: Syria calling on its army to raise its own readiness. Is Syria close to entering this conflict? We are going to take you live to Damascus.

Also, a top Republican senator now calling for an immediate end to -- quote -- "the sickening slaughter." We will find out why he's asking President Bush to change course in the Middle East. And Mel Gibson lands in rehab, following reports of his anti- Semitic rant and DUI arrest -- all that, Lou, coming up right here in "THE SITUATION ROOM."

DOBBS: Thank you very much. And, as I said, welcome back.

Today, Mexico City paralyzed over the dispute over the country's presidential election, and it spills into the streets again today, a second straight day. Backers of leftist candidate Andres Manuel Lopez Obrador blocked major highways, as they demanded a recount -- Lopez Obrador contesting the July 2 victory of the ruling party's candidate, Felipe Calderon, a victory of a whole point-six of one percent.

Officials have until September 6 to announce either a recount or to annul or validate that election.

Tonight, the number of illegal aliens living in this country could be far higher than any previous estimate. Government figures put the number somewhere between 11 million and 12 million. A Bear Stearns report has it as high as 20 million.

My guests tonight say it's near 30 million. Jim Gilchrist, co- founder of the Minuteman Project, Jerome Corsi, noted author, they have co-authored the new book "Minutemen: The Battle to Secure America's Borders."

It is good to have you here in New York.

Let me start out, Jim, the -- that idea that it would be as high as 30 million, that's a big number. Where do you get it?

JIM GILCHRIST, FOUNDER, MINUTEMAN PROJECT: Well, we start with Bear Stearns, a very valid report issued as of September 2004.

They conservatively...

(CROSSTALK)

GILCHRIST: ... estimate there is at least 20 million illegal aliens occupying U.S. territory as of two years ago -- and, to that, with the U.S. Border Patrol estimates that only one out of four to one out of five and, in some cases, areas on the border, only one out of 10 illegal aliens are apprehended, that means another five million enter every year, because 1.2 million are apprehended every year.

And no one knows who they are, where they are or what their intentions are. That brings us up to 30 million.

DOBBS: All right.

Jerome, in the book, you both write -- quote -- and if we could see this, it might be helpful to our audience at home, and we do want to be helpful to our audience at home -- "Securing the border is something the government should be taking care of as a matter of course. As far as I can figure, President Bush is delusional, lying or completely clueless as to the crisis this country faces." JEROME CORSI, CO-AUTHOR, "MINUTEMEN: THE BATTLE TO SECURE AMERICA'S BORDERS": Well, that's right.

DOBBS: Strong words.

CORSI: Well, they're strong words, but we know there are Hezbollah terrorists that have come into the United States across the border with Mexico.

We know that because they're in federal prison today. They bought their way in through the Mexican Consulate in Beirut. They set up shop in Detroit. They were sending money back to Hezbollah terrorists in Lebanon. And now they're in federal prison. With that as the case, and with Israel today fighting Hezbollah, we say there are sleeper cells in the United States.

It's proven. And the president is not fighting an effective war on terrorism if he will not secure the border.

DOBBS: Jim, the idea that we're even having this discussion, just about five years after September 11, about border security and illegal immigration, is -- is mind-boggling, isn't it? I mean, it's just -- it's...

GILCHRIST: It is.

DOBBS: It's basically nuts.

GILCHRIST: And that is exactly why, Lou, the Minuteman Project evolved. It's an alternative to political corruption, dereliction of duty, and reckless disregard for the rule of law.

And if we're going to maintain a civilized society, that is unacceptable.

DOBBS: A civilized society, one wonders if that's what we have, when a nation cannot form a consensus in its capital about securing the borders, about the rights and responsibility of citizenship in this great nation.

It -- it is, to put it mildly, a -- a peculiar era in history.

CORSI: It is, Lou. And, you know, it's bipartisan.

Both Democratic and Republican senators -- we just saw that in the Senate debate -- refuse to really secure the borders. And, as you have argued, we think and argue in the book that the Security and Prosperity Partnership of North America that President Bush signed on March 23, 2005, with Vicente Fox and with Canada is the beginning of the -- of a North American union, a new government, like the European Union.

DOBBS: Well, it's certainly what they want. And they have even taken down the Web site, as you gentlemen, I'm sure, know, in with which they were promoting the Security and Prosperity Partnership, that just had one little problem with it. The United States Congress had never approved it, nor had the American people. But that doesn't seem to be requisite.

Gentlemen, I want to congratulate on your book. It's an important book. The book is "Minutemen: The Battle to Secure America's Borders."

Jim Gilchrist, Jerome R. Corsi, we thank you both for being here and for writing an important and good book.

(CROSSTALK)

GILCHRIST: Great honor to be here. Thank you.

DOBBS: Still ahead here, we will have the results of our poll tonight and more of your thoughts.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: The results of our poll tonight: 76 percent of you responding that you do not believe any nonmilitary resolution would be effective in convincing Iran to stop its nuclear program.

Looking at more of your thoughts, Richard in Washington said: "Dear, Lou, Washington lost the war on drugs, lost the war on poverty. The only war they can win is the war against the middle class."

I hope not.

And Pat in New Jersey: "Shame on the politicians for not giving everyone at least a livable minimum wage. And shame on us for reelecting them. Wake up, America."

Lana in Kentucky: "Every time Congress gets a way -- a raise, the minimum wage should also be raised."

Not a bad plan.

Vincent in Texas: "I believe it's reasonable and equitable to have a minimum wage increase to be automatic every time Congress gives itself a wage increase."

There's a theme developing here.

And Virginia in New York: "How sleazy can the Republicans get? Trying to squeeze through that minimum wage increase tied to a tax break for the rich. Shame, shame on them. May it rain on their August vacation."

Linda in Pennsylvania: "In my opinion, all the Diebold voting machines should be sent out to Arkansas with the useless FEMA trailers contracted to be used in Hurricane Katrina."

And Donna in South Carolina: "Dear, Lou, what difference does it make if the voting machines fail or not? Our elected officials don't do a damn thing that they say they will or give a damn about the voters anyway."

And Ginny in Indiana: "Your viewer pointed out, we should have three equal branches of government. We do. They're all equally incompetent."

And Sue in Ohio: "Hi, Lou. Our secretary of state, Blackwell, who is in charge of the selection of voting machines, is running for governor. Please, someone, explain to me why this is not a conflict of interests."

You might send your thoughts about that along to us at LouDobbs.com. We love hearing your thoughts.

And each of you whose e-mail is read here receives a copy of Senator Byron Dorgan's very important new book on free trade and its consequences to the middle class: "Take This Job and Ship It."

Thanks for being with us tonight. Please join us here tomorrow -- among my guests, the Israeli ambassador to the United Nations, Dan Gillerman, former Deputy Undersecretary of Defense Jed Babbin.

For all of us here, thanks for watching. Good night from New York.

"THE SITUATION ROOM" begins right now with Wolf Blitzer -- Wolf.

BLITZER: Thanks, Lou.

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