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LOU DOBBS TONIGHT

War Between Israel, Hezbollah Escalates; War In Iraq; China Refuses to Take Back Illegal Aliens Caught in U.S.; GAO Report Shows Border Security Still a Big Problem

Aired August 2, 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, despite Israeli claims of inflicting significant damage on Hezbollah's supply of rockets, Hezbollah today launches a record number of rockets into Israel and deeper into Israel than ever before.
Tonight, thousands of Israeli troops are advancing again Hezbollah targets in Lebanon.

We'll be live with reports from Israel and Lebanon.

And two more Americans have died in Iraq today. The Iraqi president now says his troops will be taking over the security of the war-torn nation by the end of this year.

We'll have the latest for you on that development from Baghdad and Washington.

And Congress, in point of fact, will work fewer than 80 days this year. Not much of a workload. Three of the country's top political analysts, however, will take on the work of assessing the Democratic Party's chances of taking control of at least one house of Congress and a Republican Party divided on a host of issues that threaten the nation.

ANNOUNCER: This is LOU DOBBS TONIGHT, news, debate and opinion for Wednesday, August 2nd.

Live in New York, Lou Dobbs.

DOBBS: Good evening, everybody.

Nearly 10,000 Israeli troops tonight are advancing in southern Lebanon, fighting pitched battles with Hezbollah terrorists. Israel is determined to push back radical Islamist terrorists, push them as far north as the Litani River, more than 15 miles from the Israeli- Lebanese border.

But Hezbollah is fighting back. It fired a record 215 rockets into Israel today.

Israel has also stepped up its air offensive, striking targets all across Lebanon.

Six hundred Lebanese civilians and soldiers have been killed in this war, 55 Israelis killed. John Roberts reports tonight from northern Israel on the intensifying Israeli offensive into Lebanon.

Ben Wedeman reports from the southern Lebanese city of Tyre on the escalating Israeli airstrikes.

And Brent Sadler reports from Beirut on Israel's daring commando raid deep inside Lebanon.

We turn first to John Roberts -- John.

JOHN ROBERTS, CNN SR. NATIONAL CORRESPONDENT: Good evening to you, Lou.

Israel's Ehud Olmert, the prime minister, has claimed that the Israeli army has degraded or destroyed 80 percent of Hezbollah's infrastructure, but you would never know that by the Katyusha count today. They have just upped the number from 215, now 231 rockets that came into northern Israel today. That' is a record, not just a record, but a record by a very, very wide margin.

So, regardless of how far into Lebanon the Israeli army pushes, no much matter how much firepower they laid out on those Hezbollah positions, the rockets continue to fall here in northern Israel.

Lou, we also obtained today some exclusive video from the Israeli Defense Forces of their operations in and around the town of Maroun al-Ras. It was a combat camera that went in with the Israeli army. We got the pictures today.

It shows what the Israeli army claims is a Hezbollah missile launcher positioned right beside a mosque, which would seem to give some credence to the Israeli claims that Hezbollah is using religious sites and other areas in the community as shields for their weapons, making them very difficult to go after, trying to explain again what happened in Qana when they went after that rocket launcher and they destroyed the apartment building instead, killing more than 60 people.

We also got video today of the IDF, of them clearing out positions in preparation to hold ground in southern Lebanon until an international stabilization force can come in. You see an armored personnel carrier firing what are called fuel bombs into a Hezbollah outpost, trying to clear it from potential booby traps.

Before the forces go in on the ground, they always want to make sure that they can be as safe as possible. They believe that Hezbollah has left many of those booby traps, those improvised explosive devices and other devices behind. So they want to make sure that the area is safe before those troops go in.

It appears tonight, Lou, as if the operation is going to be a cordoning one. Troops going in from the northeastern tip of the Galilee peninsula, where we are, sweeping westward, and then down toward the Israeli town of Zarit to create a cordon to keep Hezbollah bottled up until that international stabilization force can come in. How much longer is this going to go on? I talked with Major General Benny Gantz (ph) today at the northern command who said it could take a while, it could be over in a few days, it could go on for many more weeks. But it appears, though, Lou, as if the diplomatic pressure continues to build. The belief here in Israel is that Sunday is just about all the time that Israel is going to have unless there is a major delay at the United Nations in forming that resolution to bring an end to hostilities and create an international stabilization force -- Lou.

DOBBS: John, thank you.

John Roberts reporting from northern Israel.

Israel today said special operations troops captured five Hezbollah terrorists during a raid deep into Lebanon. The Israelis say they killed 10 other terrorists. The target of the raid, a hospital in the town of Baalbeck. Israel said the hospital was a Hezbollah base.

Brent Sadler has the report from Beirut -- Brent.

BRENT SADLER, CNN BEIRUT BUREAU CHIEF: Thanks, Lou.

This was a sudden and dramatic twist in Israel's military tactics. This was an attempt by the Israeli Defense Forces to rattle the heart of Hezbollah's command and control network in the Bekaa Valley.

They targeted Baalbeck. Baalbeck about six miles from -- 10 kilometers from the border with Syria. About 60 miles plus deep inside northern Lebanese territory.

This was a bold operation. Israeli commandos using helicopters to land, really landing in a hornet's nest.

They fought their way into a building, a hospital that's controlled, funded by Hezbollah. There were fire fights outside, fire fights inside, supported by airstrikes by the Israeli air force. And in that operation, the Israelis checked all the ID papers of everybody inside that facility. Israel says it was a command base for Hezbollah, and they took away, Lou, abducted five Lebanese.

Now, Hezbollah says the Israelis failed in their mission, they did not get anybody important, they just took Lebanese civilians. Israel saying they took five militants and they've taken them to Israel, clearly to try to gather an intelligence harvest from that operation, because not only did they abduct those five Lebanese, presumably militants, according to the Israelis, but the Israelis also say they took a lot of information, a computer disk record that could help them with this campaign to try to defeat Hezbollah on the ground, in the air, and striking actually at the Hezbollah activists with this kind of commando operation -- Lou.

DOBBS: Brent, thank you.

Brent Sadler reporting tonight from Beirut.

Israel today widened its air offensive against suspected Hezbollah targets all across Lebanon. Israeli officials say they're trying to destroy Hezbollah's rocket and missile launchers, but the attacks have killed more than 600 Lebanese and forced nearly a quarter of Lebanon's population to flee their homes.

Ben Wedeman reports from the southern Lebanese city of Tyre.

(BEGIN VIDEOTAPE)

BEN WEDEMAN, CNN INTERNATIONAL CORRESPONDENT: A definite increase in military activity in southern Lebanon. Here from our vantage point in Tyre, we sat and watched throughout the day steady pounding from Israeli aircraft, warships and artillery in the distance. Meanwhile, we saw also a fair number of Katyusha rockets being fired out of here from the south and to the east of Tyre into northern Israel.

Elsewhere in Lebanon, intense fighting in two villages along the southern border with Israel. In Kafa Kila (ph) and Aifa Shaab (ph), there Hezbollah militiamen fighting on the ground with Israeli forces.

Meanwhile, here in Tyre, some positive news. Food beginning to arrive. A ship chartered by the Red Cross brought in 200 tons of food, plus other relief supplies. They also brought in 5,000 gallons of diesel fuel.

Fuel is becoming increasingly a problem in Lebanon. The government says they're running seriously low. And we've seen here in Tyre, some of the gas stations have no more fuel. In other places, the price has doubled. In some cases, tripled.

Apparently, the Red Cross didn't have the right kind of paperwork. They needed something from the Lebanese Ministry of Energy, and therefore it had to stay on board the ship.

I'm Ben Wedeman, CNN, reporting from Tyre.

(END VIDEOTAPE)

DOBBS: Hezbollah today fired a massive barrage of rockets into northern Israel after a two-day lull. More than 200 rockets hit northern Israel.

Fionnuala Sweeney reports from the northern Israeli city of Haifa -- Fionnuala.

FIONNUALA SWEENEY, CNN CORRESPONDENT: Lou, the heaviest bombardment of northern Israel by Hezbollah this Wednesday, more than 215 rockets fired across the northern one third of the country. One person was killed and six people injured. This has been the largest number of rockets fired by Hezbollah since this conflict began three weeks ago.

Despite also an indication by the Israeli prime minister, Ehud Olmert, that, in his words, the infrastructure of Hezbollah had been crippled. Clearly, Hezbollah still has the capability to fire missiles at Israel despite the pounding the Israeli military is giving Hezbollah north of the Israeli border -- Lou.

DOBBS: Fionnuala Sweeney.

Sectarian violence worsening in Iraq. A hundred Iraqi civilians are being killed on average each and every day. Defense Secretary Donald Rumsfeld today compared the violence in Iraq to our civil war.

We'll be going live to the Pentagon for the latest.

And Congress going on vacation, and lawmakers are going to be explaining themselves before their constituents.

And we'll have that special report.

The war in Israel and Hezbollah escalating across a number of fronts. We'll have those reports, more from Lebanon and Israel and Washington, next.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: This just in to CNN. We've just received word that Israel tonight has just carried out an airstrike against suspected Palestinian terrorists in southern Gaza. Israel said that Palestinians were carrying a rocket-propelled grenade launcher when they attacked. Palestinian sources say that one Palestinian was killed in the strike, four others were wounded.

Turning to the war in Iraq, the Iraqi president today predicted that Iraqi troops could take over security in all 18 provinces of Iraq by the end of this year. He said U.S. and other coalition troops would play only a supporting role. The Iraqi president's remarks come as insurgents and terrorists are killing on average each day in Iraq 100 Iraqi civilians.

Defense Secretary Donald Rumsfeld today declared that the sectarian violence does not constitute what he called a classic civil war.

Harris Whitbeck reports from Baghdad. And Barbara Starr will report on the Pentagon's efforts to describe what is happening in Iraq in new and different terms.

We turn first to Harris Whitbeck in Baghdad -- Harris.

(BEGIN VIDEOTAPE)

HARRIS WHITBECK, CNN CORRESPONDENT (voice over): Another Baghdad bombing. Once again, Iraqi day laborers were the target. Two bombs hidden in a plastic bag went off as they waited on a street corner for work, killing at least three. As the wounded were taken to a nearby hospital, Iraqi president Jalal Talabani was saying in a press conference he is confident his own country's troops will be in charge of security operations in the entire country by the end of the year, and that the coalition would take a back seat.

JALAL TALABANI, IRAQI PRESIDENT (through translator): The role of multinational forces is to help Iraqi armed forces. And the Iraqi armed forces, god willing, will take over the security by the end of the year in all of the Iraqi provinces gradually.

WHITBECK: Little by little is what the U.S. has in mind. A senior U.S. official in Baghdad told CNN the focus now is on training and equipping the Iraqi army and police force, and that that process would have to be completed before full control of Iraq's provinces is relinquished.

Meanwhile, the U.S. is actually increasing its troop presence in the Iraqi capital. More than 3,700 Army troops will be redeployed from the northern city of Mosul to crack down on growing violence in Baghdad.

(on camera): U.S. military officials say the battle for Baghdad is the most crucial one being waged. They say the ongoing violence here does not allow Iraqi government officials to focus on long-range policies. They also say the situation in the capital as uncertain as it has ever been.

Harris Whitbeck, CNN, Baghdad.

(END VIDEOTAPE)

DOBBS: Insurgents have killed two more of our troops in Iraq. A soldier and Marine killed in Al Anbar province, west of Baghdad.

2,580 of our troops have been killed in Iraq since this war began.

Defense Secretary Donald Rumsfeld today tried to define the meaning of civil war and whether or not a civil war is actually taking place in Iraq. This is not the first time the defense secretary has struggled to describe events in Iraq with his own definitions. You may remember he once called insurgents bitter-enders, dead-enders and thugs.

Barbara Starr reports from the Pentagon on the secretary's latest struggle with language -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Lou, it was a struggle with language and a struggle with dictionary, and a struggle to really understand today where this secretary was coming from. He seemed a bit subdued as he faced reporters. He did say that he thought the level of sectarian violence in Iraq was high, but he wouldn't take that step toward saying it was a civil war.

(BEGIN VIDEO CLIP) DONALD RUMSFELD, SECRETARY OF DEFENSE: We can all go to the dictionary and decide what you want to call something. But it seems to me that it is not a classic civil war at this stage.

It is -- it is a -- it certainly isn't like our Civil War. It isn't like the civil war in a number of other countries.

Is it a high level of sectarian violence? Yes, it is. And are people being killed? Yes. And is it unfortunate? Yes.

And is the government doing basically the right things? I think so.

(END VIDEO CLIP)

STARR: Lou, the secretary also said that he thought things were happening in Iraq that, in his words, one could wish weren't happening. That's how he described how Shia and Sunni people were fleeing the violence in Iraq.

And it remains to be seen what it all looks like here tomorrow in Washington. There's going to be a hearing, an open hearing of the Senate Armed Services Committee.

General Abizaid and General Pace are expected to appear. Secretary Rumsfeld will not be there.

He has discussed this with the committee. He said his schedule is very busy tomorrow. He will focus on appearing behind closed doors on Capitol Hill, briefing members of Congress. But Lou, this has caused some concern at the Senate Armed Services Committee, because they say they've not had the opportunity to question the secretary publicly about the war since February -- Lou.

DOBBS: 2,580 Americans dead in that war, and we are watching a struggle with language to define an enemy that this secretary of defense, this administration and the general staff in that Pentagon have underestimated since the outset. One doesn't doubt that the Armed Services Committee wants to hear far more from the secretary and those generals as to what they are doing with the lives of our young -- our brave young men and women in uniform in Iraq.

Is that -- is this the beginning, perhaps, of some accountability for the general staff?

STARR: Well, I do think that what the members of the Senate Armed Services Committee will be watching very carefully tomorrow is what General John Abizaid has to say, the head of the Central Command.

He also has kept a very low public profile in recent weeks and months. He pretty much makes no public appearances. He does not conduct press conferences. He does appear before the committee, but they haven't talked to him in a while either.

And there is certainly going to be a lot of questions for him about the progress in the war -- Lou. DOBBS: Barbara, thank you very much.

Barbara Starr reporting from the Pentagon.

That brings us to the subject of our poll tonight. The defense secretary called the sectarian violence in Iraq today unfortunate, but said he does not consider it to be a classic civil war.

How would you characterize the escalating deadly violence in Iraq? Unfortunate? Sectarian violence? Or civil war?

Cast your vote at LouDobbs.com. We'll have the results here later.

Still ahead, the United States trying to deport tens of thousands of Chinese illegal aliens back to communist China. Guess who isn't cooperating? Guess who can't do a thing about it?

We'll have that special report on our Department of Homeland Security.

Also, a shocking new report of just how easy it is to enter this country with fake identification, as if we needed more proof. Congressman Darrell Issa of the House Judiciary Committee joins me on our worsening border security crisis.

And nearly 10,000 Israeli troops advancing in Lebanon tonight, fighting fierce battles with Hezbollah. We'll have the latest for you on this widening conflict.

Matthew Chance reports tonight.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Israeli Prime Minister Ehud Olmert today said Israel will stop its offensive only when a strong international security force is in southern Lebanon. Nearly 10,000 Israeli troops are now there. Those troops fighting pitched battles with Hezbollah terrorists in towns and villages across southern Lebanon.

Hezbollah today fired a record number of rockets at Israel, 231. One Israeli killed.

We'll have much more tonight here on the widening conflict. That coming up in just a matter of moments.

But first, the U.S. government tonight is trying to deport some 40,000 Chinese illegal aliens back to communist China. But the government of communist China refuses to allow them to be sent back. So our Department of Homeland Security has decided to respond by simply letting them go.

Kitty Pilgrim has the report.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice over): If Chinese illegal immigrants are caught in the United States and U.S. immigration officers try to deport them, China routinely refuses to take them back. Homeland Security Secretary Michael Chertoff recently said out of all the illegal immigrant groups, they're the largest population that we've had difficulty returning.

There are about 40,000 illegal Chinese immigrants in the U.S. today with orders to be sent home. They are routinely released because China won't accept them. Only 600 are now in custody.

In a recent speech, Chertoff appears to cave in to the Chinese government and the illegal influx, saying, "If illegal immigrants are not accepted back, then for all intents and purposes, they are free to remain in this country, because we have no place to remove them to."

Chinese gangs have operated the lucrative smuggling rings for years, taking thousands of dollars in fees to bring illegal Chinese immigrants to the United States.

PAUL VIRTUE, FMR. GEN. COUNSEL, INS: It sends a message to people who might come to the U.S. illegally that -- that it may be very difficult for them to be returned, and if they make it here, they may end up being here for years and years, or possibly even be able to live here.

PILGRIM: The United States is highly dependent on trade with China, so some say the United States has no real way to take action. Normal retaliatory measures like withholding visas would hurt business travel and would also hurt U.S. business.

BATES GILL, CENTER FOR STRATEGIC & INTERNATIONAL STUDIES: China is an important country. It has a lot of influence in all different aspects of the global system. And so it's not going to be as easy for the United States to apply pressures or seek these sorts of concessions from China as it might be with other countries.

PILGRIM: China is clearly breaking with international protocols and standards without consequences.

(END VIDEOTAPE)

PILGRIM: Now, China's Ministry of Foreign Affairs has denied the charge. They say they're cooperating with U.S. immigration authorities. That cooperation is turning out to be a mere token gesture.

In June, a charter flight of 100 illegal Chinese immigrants went back to China, but that's a mere fraction of the tens of thousands of Chinese illegal aliens that have been caught here in the United States, Lou. And the best part of it is China says they have to make sure that they're really citizens of China before they take them back.

DOBBS: I wouldn't trust our Department of Homeland Security either. They can't confirm anything. They seemingly are impotent and incapable in everything they attempt to do.

PILGRIM: This is one of the most unbelievable stories.

DOBBS: I think the idea of Michael Chertoff, the secretary of Homeland Security, just throwing his hands up and saying, well, I guess they're going to get to stay here because there's no cooperation from China, this man is running a department that is an utter and complete joke and sham. Can't secure the ports, can't secure the borders, can't deport people.

I wonder what the impact would be -- most of the illegal immigrants in this country, those illegal aliens, come from Mexico, from Central America. What if Vicente Fox, George Bush's big pal, decided he wouldn't take any back?

Oh, that's right. We're not sending them back anyway. Never mind.

Kitty Pilgrim, the absurdity goes on, brought to you by your federal government.

Thank you. Appreciate it.

Taking a look now at some of your thoughts, Roxie in Minnesota, "Congratulations, Grandpa Dobbs. I hope your hard work results in changes so your grandchild and mine have a better world."

Well, thank you very much.

Rick and Elsie Allen (ph) and Debby (ph) and Lou Dobbs are very proud of their first granddaughter, Malaya Maria (ph). And we do hope with you that everyone's grandchild has a much better world waiting for them.

It isn't going to happen by accident, however.

Cliff in Washington, "Lou, everything on your show really pisses me off. It does not matter which of the universe's ills du jour you are covering at the moment. Your information pisses me off. Of course, it is all true. So keep up the good work."

Oh, if I only could make it not true.

Steven in Oklahoma, "Lou, let me get this right, a judge who swore to uphold the law, not future ones, refuses to uphold and enforce the law? It seems our country has finally fallen to that of a third world country where the lawless rules. Maybe I should renounce my citizenship and get all those benefits that illegal seem to get."

Chris in Texas, "Lou, why are we surprised about a federal judge ignoring the law? Our president does so on a regular basis."

Alex in Pennsylvania, "Lou, this is great. Do you know where one can get a list of other laws that might change so that we can ignore them now?"

Please, don't.

Send us your thoughts at LouDobbs.com. More of your thoughts are coming up here later.

We'll have much more tonight on the Middle East conflict.

And tonight, dramatic new evidence that some of America's border crossings are wide open to terrorists. Undercover agents have demonstrated that fake IDs and phony names are all you need if you want to cross one of our ports of entry.

You know, where we have Customs and Border Patrol and real immigration officials waiting? It just doesn't seem to matter. We'll have a special report.

And today the Senate voted to fund tough new border fencing, but does the White House share the Senate's priorities? I'll be talking with a congressman who has new figures on the staggering costs of illegal immigration and how much of a burden illegal immigration is to taxpayers.

Also tonight, Hezbollah terrorists and Israeli troops battling each other in close combat in Lebanon. We'll have the latest on what is now an expanding ground war.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Israeli aircraft tonight are carrying out new airstrikes across Lebanon as Israeli troops advance north from the Israeli- Lebanese border. Hezbollah today fired the highest number of rockets yet in this conflict, firing them into Israel, more than 230 rockets.

Matthew Chance reports from northern Israel.

(BEGIN VIDEOTAPE)

MATTHEW CHANCE, CNN CORRESPONDENT (voice-over): The brutal battlefields of Southern Lebanon. Across the hills, thousands of Israeli troops, backed by tanks and air power, are fighting in towns and villages, Hezbollah strongholds, Israel says. Their objective now, to push Hezbollah back from the border, creating a buffer zone for Israel. Until a diplomatic solution is agreed, Israeli officials insist there will be no let-up.

EHUD OLMERT, ISRAELI PRIME MINISTER: Israel will stop fighting when the international force will be present in the south part of Lebanon. We can't stop before that, because if there will not be the presence of a very effective, robust military international force, Hezbollah will be there. And we will have achieved nothing.

CHANCE: He may mean Israeli forces in and out of Lebanon for weeks to come, even if an international force is agreed soon. And they're operating well beyond Lebanon's southern border with Israel. This, the grainy footage of an Israeli special forces raid in the ancient city of Baalbeck in the country's northeast. An Iranian-built hospital was the target. The Israeli military says part of it was being used as a Hezbollah logistics base, a hiding place for the militia's leaders.

LT. GEN. DAN HALUTZ, ISRAELI CHIEF OF STAFF: Our success in this operation was that we captured five Hezbollah terrorists and we killed more than ten Hezbollah terrorists, some of them inside the hospital.

CHANCE: Hezbollah says the killed and captured were civilians. And the militia has delivered its ferocious response. More rockets pounding Israel than on any day in this conflict so far. One even struck the Palestinian West Bank, more than 40 miles from the Lebanese border, the farthest south a Hezbollah rocket has ever reached.

(on camera): Israeli military officials insist they're extracting a heavy price from Hezbollah, even though the militia is clearly able to strike at will in towns and cities across Israel's north. The realistic objective now, say military officials, not crushing Hezbollah as a military force, merely pushing them back. Matthew Chance, CNN, on the Israeli/Lebanese border.

(END VIDEOTAPE)

DOBBS: Later in this broadcast three of the country's top political analysts join me to give us their assessment of the progress of this war, it's effect on U.S. foreign policy.

Also tonight new proof that potential terrorists could walk right into this country, no questions asked. And there is no overstatement in that statement. Undercover agents using fake I.D.s and phony names to enter the United States from both Mexico and Canada. In some cases, they were not even asked for their phony identification. Lisa Sylvester reports.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Nine times undercover investigators tried to enter the United States using fraudulent birth certificates and driver's licenses. Nine times U.S. Customs and Border Protection let them in.

SEN. CHARLES GRASSLEY (R), IOWA: Those government accountability investigators could have been known criminal, wanted fugitives or even terrorists. But they were just somehow waved into our country.

SYLVESTER: The Government Accountability Office tested entry ports earlier this year in California, Arizona, Texas, New York, Michigan, Idaho and Washington State. In one instance, a GAO investigator used an expired, altered U.S. diplomatic passport to enter. Another occasion, he simply walked across the border without passing through a checkpoint. Yet another time, the investigator sweet talked his way into the country.

JOHN COONEY, GAO INVESTIGATOR: We were never asked to show any identification. We just asked if we were U.S. citizens, then told to come into the country. SYLVESTER: This is not the first time that security breakdown at the border has been exposed by investigators. The GAO conducted similar tests in 2003. In this year's investigation, GAO even used one of the same names from 2003, and amazingly customs still did not question the document's authenticity. The Department of Homeland Security acknowledges the problem, but blames it on a lack of a secure travel document for visitors from Mexico and Canada.

JAYSON AHERN, CUSTOMS AND BORDER PROTECTION: What we need to provide the level of security to identify individuals coming into this country, to run it against the watch list, determine their citizenship. We need to make sure that we have a standardized document that has the biometric feature, whether it is a passport or a pass card that's machine readable.

SYLVESTER: Right now more than 8,000 different travel documents are accepted at U.S. land borders including 240 different types of driver's licenses.

(END VIDEOTAPE)

SYLVESTER: January 2008, U.S. citizens and all travelers within the western hemisphere will have to have a passport or other secure identification to enter the United States but there is a bill that has been introduced in Congress to push back the implementation date 18 months, despite the fact that there is this glaring security loophole. Industry groups are pushing for the delay because they worry it will impede the flow of trade, Lou.

DOBBS: You know, it's amazing. Talking about biometrics, the U.S. visa program, when border agents and custom agents at the border are not even asking for identification at all? I mean, this is a joke.

SYLVESTER: This is indeed a problem and the fact is that Congress is aware of this problem. Homeland Security is aware of this problem and still nothing has been done, Lou.

DOBBS: Imagine that. Something not done at the Department of Homeland Security, which is the biggest joke in the federal government. And there's a lot of competition for the standard. Thank you very much. Lisa Sylvester reporting from Washington.

The Senate today voted overwhelmingly to build hundreds of miles of new fencing along the U.S. border with Mexico, the Senate approving almost $2 billion for the construction of 370 miles of new triple layer fencing. The vote is a major victory for Senator Jeff Sessions who has fought tirelessly to free up funds for new border fencing. Senator Sessions joins us here tomorrow evening. We hope you'll be with us as well.

Local governments across this country have had it. They're struggling to provide health care, education and other expensive social services to illegal aliens. The House Judiciary Committee today heard new evidence that taxpayers will see those costs skyrocket if the Senate's Illegal Alien Amnesty Bill were to become law. Congressman Darrell Issa of California, member of the Judiciary Committee, joins us tonight from San Diego where today's hearing was held. Good to have you here.

REP. DARRELL ISSA (R), CALIFORNIA: Thanks for having me on, Lou.

DOBBS: Congressman the idea of these costs. We've been reporting on the burden on American taxpayers. We've been reporting on this broadcast who the real victims are, taxpayers, working men and women in this country and their families. The costs, what did you learn today about the burden on American taxpayers?

ISSA: Lou, we learned today really was that none of the panelists, including those from the other side of the aisle, really could make the case that it wasn't a cost. Just the opposite. What they were trying to do was get into other factors, talk about fairness and try to be partisan. What we're really focusing on here is, to a great extent, the fact that out of 6 billion people on the face of the earth, 99 percent of all the people who come to this country illegally are coming from one country. That's a disservice to the Statue of Liberty. It's a disservice to the tradition we've had of legal immigration, of taking those that we can absorb in a reasonable and orderly fashion.

It's the lack of orderly fashion that creates this problem, Lou. It's the lack of orderly fashion that the House bill is trying to create by having real enforcement. We can have a discussion on how many people immigrate to this country. We cannot have is a discussion as to whether or not we enforce our laws.

DOBBS: Why is, in your judgment, the Senate or the Republican leadership coupled with the Democratic members of the Senate and over the wishes of the Senate's Republican majority, passed an amnesty bill that is so clearly targeted at taxpayers who have to pay the onerous costs of illegal immigration and take into account none of the real victims here, taxpayers, American taxpayers, working men and women who are seeing their wages depressed by $200 billion a year. Why does this Congress, Congressman, continue to permit this kind of nonsense to go on? Some sort of silly Kabuki (ph) dance that the national media follows along like guppies feeding on the surface.

ISSA: Well, you know, Lou, there's never been a time more than today for me to say, let's not talk the word Congress, let's talk House and Senate. The House overwhelmingly wants enforcement and opposing an amnesty because it's been tried before and failed. The Senate, I'll take them at their face value. I won't assume the worst, but the Senate has made a very different decision. There's an intervening election that may very well occur before this is settled. That's going to be for the voters to make a strong statement, a statement toward many of those senators that they truly do not agree, that in fact we may be able to expand guest worker programs. We can't do it by having a broad amnesty as a starting point. That's where the House has pushed back.

DOBBS: Congressman, you're quite right on the distinction between House and Senate. I defer to your judgment and your definition. It's the correct one on that. But you've also got a president who is basically saying, open up the doors, it doesn't matter about enforcing laws or our border. I mean, that's got to leave your stomach in some turmoil, doesn't it?

ISSA: It does. And I take the president at his word that it is truly his compassionate conservatism.

DOBBS: I don't care what it is. It's hurting a lot of folks.

ISSA: Lou, you're right. A lot of people who have rallied around the president, to be honest, are just fighting for a special interest vote. They're fighting for those who would vote because of an amnesty. I think the most important thing that the House has done is said, and I have 30 percent Hispanic in my district, but we've made it very clear that we're going to do what's right for the next generation, not what's right for the next election, particularly not what's right for the next presidential election, which I think is what a lot of those senators are thinking about.

DOBBS: And it has been demonstrated in elections and polls across the country, most Hispanics, most Americans who happen to be Hispanic want to see border security and they want to see rational immigration policy carried out by this country.

ISSA: Absolutely.

DOBBS: Congressman Darrell Issa, great to have you with us. We appreciate it.

ISSA: Thank you, Lou.

DOBBS: Still ahead, we'll have your thoughts on the American citizens now living in Chinese shipping containers, a special report that we brought to you earlier this week.

And you'll hear my thoughts on a U.S. senator who appeared to blast this broadcast today because we stand up for working men and women and we don't really buy into just one little set of facts, so we'll set the facts straight. Dana Bash will have a special report tonight on what some are calling a do-nothing Congress. I'm one of them. Stay with us for that.

And Hezbollah has launched a new barrage of rockets into Israel as the war in the Middle East widens. Three of the country's best political analysts join me. Stay with us.

(COMMERCIAL BREAK)

DOBBS: As we reported, Hezbollah today fired a record number of rockets into Israel and deeper into Israel than ever before -- 231 Hezbollah rockets struck Israel today. One of them landed in a town more than 40 miles south of the Lebanese border.

The Hezbollah attacks come despite Israeli claims that Israel has destroyed Hezbollah's entire infrastructure. Israel aircraft tonight are launching new airstrikes. Up to 10,000 Israeli troops are now operating in Lebanon. We'll have more on this widening conflict. War raging in Iraq and the Middle East, ever rising energy prices emptying Americans' wallets, the federal minimum wage stands where it has for almost a decade, $5.15 an hour. But in Washington, the Senate about to take a month off. The House, they're already out of town.

Dana Bash has the story.

(BEGIN VIDEOTAPE)

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT (voice-over): Before heading home for a month-long recess to campaign, this -- a clear sign Republicans are trying to shed a do-nothing label.

SEN. BILL FRIST (R-TN), MAJORITY LEADER: The stem cell bill, the alternative stem cell technology bill passed, the field farming prohibition bill passed. The Adam Walsh Child Safety Bill passed.

BASH: Rapid-fire lists from the GOP leader while senators up for re-election tick off measures that played at key voter concerns like security.

SEN. JON KYL (R), ARIZONA: The Republican leadership was able to build a consensus to get the Patriot Act reauthorized and to provide the tools to fight the terrorists.

BASH: Republicans only plan to be in session about 15 days this fall and they're battling this ...

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.

BASH: In 1948, the year Harry Truman ran against what he called a "do-nothing Congress," the Senate was in session 114 days. This year, the Senate is scheduled to meet just 99 days. Congress has approved billions to fund disasters like Katrina and wars in Afghanistan and Iraq, despite deep discord over policy there.

Yet other GOP priorities have stalled in the Republican-run Congress: one, the president's push to overhaul Social Security with private accounts; another, the lobbying reforms promised in the wake of the Jack Abramoff scandal. And then there's immigration. House Republicans are standing firm against a Senate plan to create a guest worker program. On that issue they hope for plan B.

SEN. MITCH MCCONNELL (R), KENTUCKY: There are differences among members of our party on immigration. One thing we don't have any differences on is securing the border.

BASH: Republicans blamed Democrats for obstruction, but some GOP strategists fear Republicans have handed Democrats a potent theme.

SCOTT REED, REPUBLICAN STRATEGIST: By not concluding their business, they gave the Democrats an opportunity to position themselves as agents of change. BASH: Some major legislation has passed with bipartisan support, like a bill making it harder to declare bankruptcy. A boon for business, critics say, but a potential nightmare for consumers, even some middle class Americans who filed for bankruptcy to pay for high medical costs. And healthcare is another major voter concern Congress did not deal with.

(END VIDEOTAPE)

BASH: But Republicans up for re-election are banking on all politics still being local, whether it's helping to keep a military base open or helping to build bridges and roads back in their states.

Lou, lawmakers will do what they have always done, which is try to play up ways that they think voters -- excuse me, where they have helped voters back home, I should say -- Lou.

DOBBS: Thank you very much, Dana Bash reporting from Capitol Hill.

On Capitol Hill today, Senator Bob Bennett, Republican of Utah, strongly defended the Republican economic policies and the performance of this nation's economy. Senator Bennett called the economic performance of the past five years, quote, "exciting." And the senator appeared to target this broadcast for its reporting on the economy and so-called free trade.

(BEGIN VIDEO CLIP)

SEN. BOB BENNETT (R), UTAH: The individuals are earning more, and they pay more income tax. And corporations are earning more, and they pay more income tax as a result of this growth of the economy. So to the Hollywood comedians who talk about the armies and the tank, and some of the scare people on cable television who say, we're losing everything to the Chinese, let's recognize the real facts.

(END VIDEO CLIP)

DOBBS: Senator, I couldn't agree with you more. Senator Bennett said during today's news conference that we can have our own opinions on the economy, but we can't have our own facts. Like I say, I agree with you, Senator. And you desperately need to get the facts straight.

You need to line up your facts somewhat more closely aligned with reality. Over the past five years, real wages -- you know, the people who work for a living in this country, who make up the middle class, the foundation of this country? Well, those wages have declined for most of our workers. Job growth still lags behind historical norms of recovery.

And you may not have noticed, Senator, but oil and gasoline prices happen to be at record highs and appear to be headed ever higher. College costs, prescription drug prices are far outpacing inflation. The minimum wage, which your colleagues in the Senate refuse to raise -- but see nothing wrong with experience during the same period eight raises of your own in your pay -- is at the lowest level of buying power in a half century. Let me say that again, Senator. The minimum wage in this superpower is at the lowest level of purchasing power in half a century.

Our current account deficit -- and I know, Senator, you're a faith-based free trader. Our current account deficit is on track to hit a trillion dollars this year, senator. Our trade deficit with China has more than doubled over the past five years.

And while you brag about the increase in those government tax receipts, you might be wise to remember that those tax receipts are coming mainly from working men and women, not your masters in corporate America who cheer your faith-based economic policies.

Those are the facts, Senator. I just wanted to make sure we were sharing them. And if you'd like to read more of my thoughts on this Congress, as lawmakers go on their five-week vacation, please go to LouDobbs.com, to CNN.com, the home page there for my commentary on this do-nothing Congress.

Coming up at the top of the hour, a fellow who does a lot. "THE SITUATION ROOM" with Wolf Blitzer -- Wolf.

WOLF BLITZER, CNN ANCHOR: Thanks very much, Lou.

Hezbollah rockets showering down on Israel in record numbers today while thousands of Israeli ground forces pushing deeper inside Lebanon right now. We're going to take you live to the frontlines.

Plus I'll speak with Senator John McCain.

Also inside a raid. Israeli soldiers penetrating what they say is a Hezbollah headquarters. We have a CNN exclusive report.

And Iraqis taking over the security of their own country. Can they make it happen by Christmas?

Finally, Fidel Castro's sister now speaking out. She lives in Miami, but has very strong feelings about the celebrations of his illness. She shares what she says are insider thoughts about his health.

All that, Lou, coming up right here in "THE SITUATION ROOM."

DOBBS: Wolf, thank you very much. A reminder to vote in our poll tonight. Defense Secretary Rumsfeld calling sectarian violence in Iraq "unfortunate," saying how ever he doesn't consider it to be a classic civil war. How would you characterize the escalating deadly violence there? Unfortunate, sectarian violence or a civil war? Cast your vote at LouDobbs.com. We'll have the results coming up here in just a few minutes.

Tonight Israel insisting its inflicting serious damage on Hezbollah, but today, a record number of Hezbollah rockets struck Israel. Israel has released this graphic footage of an Israeli raid deep into Lebanon. I'll be talking about this war with three of the country's best political analysts. Stay with us for that and a great deal more.

(COMMERCIAL BREAK)

DOBBS: Joining me now, former Reagan White House political director, Republican strategist Ed Rollins, Democratic strategist Robert Zimmerman, Michael Goodwin, "New York Daily News" columnist. Good to have you here.

Let's start out with the conflict in the Middle East, Michael. This war, it is strange to hear people saying to the Israeli government and their representatives, how much more time do you need? Or if they're critical of the government, how many more days before you get out? I don't know that I've ever heard that.

MICHAEL GOODWIN, COLUMNIST, NEW YORK DAILY NEWS: Right. I mean, we're trying to bargain the end of a war here and it's very difficult. Both sides are still fighting very ferociously. The number of Hezbollah rockets today was a new record, over 200. Israel going deeper into Lebanon, sending more troops in. I think one of the problems with ending this, Lou, is that what country is going to want to send its soldiers in as part of the multinational force unless both of them agree to stop fighting first? And I think that's not on the cards right now.

DOBBS: Well, I love the fact that Secretary of State Condoleezza Rice, Robert, says that she wants a peace that is sustainable and that there's no sense in having a cease-fire unless it's something that's profound in its nature, something that has eluded diplomats for just about 60 years. U.S. policy here is bizarre.

ROBERT ZIMMERMAN, DEMOCRATIC STRATEGIST: Well there really is no U.S. policy here. The bottom line is the state of Israel is pursuing a policy of disarming Hezbollah and weakening them so that you can in fact put in some sort of credible peacekeeping force. And the fact that the U.S. has ignored the region for five to six years has been -- I think has had tragic consequences for Israel and for -- and tried to achieve some sort of significant peace in the region.

DOBBS: Republicans and Democrats seem to be outdoing themselves in expressing their support for the Israelis as they often do when these conflicts erupt. Neither party seems to have any sense of proportion or balance, however, in a policy going forward in the Middle East. As if it's in U.S. interests to see Israeli bloodshed and Arab bloodshed, which it definitely and definitively is not.

ED ROLLINS, FORMER WHITE HOUSE POLITICAL DIRECTOR: We're taking a position other than to stand behind our friend and our ally, which is Israel.

But the long-term damage to both us and to Israel is when you watch 10 days of carnage and you watch innocent people being killed and Hezbollah obviously is a terrorist entity, but over time, people forget that when they see hundreds of kids being killed and you see another country being destroyed and damaged.

We now have Iraq that we're going to have to rebuild and we're now seeing Lebanon that we're going to have to rebuild and the costs both in a P.R. way and in a physical plant cost is going to be enormous. And I think you saw the Saudis today basically saying we wish we had the old Middle East. And I think to a certain extent, that's the danger.

DOBBS: I want nothing to do with the old Middle East.

ROLLINS: I don't either.

DOBBS: According to the latest poll, 85 percent of those surveyed say that Iraq will be extremely important or very important. Michael, Iraq, it was torturous today to hear Secretary of Defense Donald Rumsfeld in some sort of soliloquy trying to define whether there was a civil war, whether it is unfortunate, whether it is sectarian violence and ruminating. I mean, we have generals who are not prosecuting successfully a war. What is going on?

GOODWIN: Well, I don't think it does matter what we call it. I think what does matter, Lou, is that we are running out of time. I think the Iraqi government is running out of time. And the American public is clearly not anxious to keep it going.

But I think there is a real issue here. I mean, can we defeat a terror organization OR do we withdraw and leave Iraqis to themselves? I feel that if we withdraw, we're going to create a hell hole like we've never seen before and it's going to come back to bite us.

ZIMMERMAN: I don't see those as the options. The reality of the situation in Iraq is not whether we withdraw. The issue is whether we'd make a determination to be an occupying power in the region and stay there permanently or whether we're going to place the proper pressures on the Iraqi government to stand up and put their own military in place to defend themselves.

ROLLINS: We have to learn the lessons we didn't learn in Vietnam, is we're in guerrilla battles. Terrorists are guerrillas. They're not fighting the standard way and just as the Israelis have found out how difficult the Hezbollah is and may win eventually, we in Iraq are basically a bunch of guerrilla terrorists. And we have to retrain our troops and we rethink our process, because this is what the wars are going to be like for the next several decades.

DOBBS: I understand that's the thinking and I understand it's what these generals are thinking. They keep talking about long wars. I happen to believe that the United States gets involved in a conflict, I happen to believe powerfully in the Powell doctrine, which was contravened by everything that's been done here. But if we don't return to that and have the political will and the moral standings to inflict maximum damage against our enemy...

ROLLINS: ... It was used one time and it was very successful, the first Gulf War. GOODWIN: But you know what, I think that the public won't stand for the civilian casualties. That's something that the Israelis are discovering now.

DOBBS: When you have generals asking you for patience instead of telling you about their successes and their strategy, there's something awful wrong here.

ZIMMERMAN: When you have politicians fighting a war and not listening to the military, that's the road to disaster.

DOBBS: Yes, and neither political party with an original idea in three years. We thank you very much, gentlemen, we appreciate you being here. The results of our poll tonight, 87 percent of you would characterize in our poll tonight the escalating deadly violence in Iraq as a civil war, an assessment not shared by Defense Secretary Rumsfeld, our other opthamologist of great repute.

More of your thoughts now quickly. Brian in New York saying: "Americans living in boxes inside China, sad crying shame. It's not members of our political leadership."

Andrea in Ontario: "Lou, up here in Canada, all immigrants have to learn English or French before they can become citizens, yet we're considered the most multi-cultural society on the planet, requiring immigrants to learn the languages is common sense."

Send us your thoughts at LouDobbs.com. Each of you whose e-mail is read here receives a copy of Senator Byron Dorgan's important, interesting new book, "Take This Job and Ship It." Thanks for being with us tonight, please join us here tomorrow. Jeff Sessions, senator joins us -- Senator Jeff Sessions. For all of us, thanks, good night from New York. "THE SITUATION ROOM" begins right now with Wolf Blitzer. Wolf?

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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